Chapter 3

The Roles of the Auditor and the Forensic Accounting Investigator

James S. Gerson, John P. Brolly, and Steven L. Skalak

To understand the forensic accounting investigator's role in deterring, detecting, and investigating fraud—as distinct from the independent auditor's role as a financial statement examiner—we need to first recall the differences between what auditors do and what forensic accounting investigators do and why. Also, their professional worlds have changed in recent years, in ways that bear close examination.

The auditor's concern is that the financial statements of an entity be stated fairly in all material respects. Accordingly, the auditor's responsibility is to design and implement audit procedures of sufficient scope and depth to detect material deficiencies in the financial statements—essentially, without regard to the source or origin of the deficiency. Auditors are charged with making appropriate, reasonable efforts to detect material misstatements in financial statements and causing management to correct material misstatements or misrepresentations before the financial statements are shared with the user community or, alternatively, alerting investors not to place reliance on the statements through qualification of their professional opinion issued as part of the company's public filings. Even this seemingly simple statement of the auditor's mission brings into play a series of interrelated and complex concepts, including:

  • Reasonable assurance ...

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