Authors :
Etim, E. Osim; Comfort Precious Goddymkpa; Nsima Johnson Umoffong
Volume/Issue :
Volume 5 - 2020, Issue 7 - July
Google Scholar :
http://bitly.ws/9nMw
Scribd :
https://bit.ly/2CIuunf
DOI :
10.38124/IJISRT20JUL105
Abstract :
The aim of this study is to identify the most
potent factors driving audit failures by theoreticallyexploring two most publicized corporate and external
audit failures cases in Nigeria and globally (EnronAndersen and Cadbury Akintola Williams Deloitte). An
exploratory case study approach was adopted to analyze
the selected two cases and several other external audit
failures in extent literature. Findings reveal that audit
failure factors are the same in the cases analyzed and
compared and include poor audit approach, negligence
and incompetency from the auditors, lack of
professional questioning attitude, connivance with
clients, fee dependence on major clients, long tenured
appointment, external auditors acting as internal
auditors to client and rendition of Management
Advisory Services (MAS), blatant disregard to
accounting standards on auditing, among others. Based
on these findings, the following recommendations were
made: more stringent sanctions be molted to defaulters,
regular review and update of accounting and auditing
standards to take care contemporary developments,
prohibition of external auditors from rendering
multiple MAS, adherence to ethical principles,
strengthening of corporate governance structure as well
as improved oversight functions by regulatory
authorities on the activities of corporate management
and auditors.
Keywords :
Audit failures, account manipulations, negligence, lack of competency, MAS
The aim of this study is to identify the most
potent factors driving audit failures by theoreticallyexploring two most publicized corporate and external
audit failures cases in Nigeria and globally (EnronAndersen and Cadbury Akintola Williams Deloitte). An
exploratory case study approach was adopted to analyze
the selected two cases and several other external audit
failures in extent literature. Findings reveal that audit
failure factors are the same in the cases analyzed and
compared and include poor audit approach, negligence
and incompetency from the auditors, lack of
professional questioning attitude, connivance with
clients, fee dependence on major clients, long tenured
appointment, external auditors acting as internal
auditors to client and rendition of Management
Advisory Services (MAS), blatant disregard to
accounting standards on auditing, among others. Based
on these findings, the following recommendations were
made: more stringent sanctions be molted to defaulters,
regular review and update of accounting and auditing
standards to take care contemporary developments,
prohibition of external auditors from rendering
multiple MAS, adherence to ethical principles,
strengthening of corporate governance structure as well
as improved oversight functions by regulatory
authorities on the activities of corporate management
and auditors.
Keywords :
Audit failures, account manipulations, negligence, lack of competency, MAS
