The role of an auditor is to give an independent opinion concerning the financial statements of a company. As such, the auditor should maintain independence by avoiding things that could compromise the ability to provide an opinion that reflects the actual state of the financial affairs of a company. In this case, the auditor, upon discovering that there was fraud in the company, should have instructed the employees not to destroy the documents used in the audit exercise. Destruction of documents used in the audit leads to the loss of evidence that could have been crucial in investigating the fraud and preventing further loss of resources in the company. An auditor should always follow the procedures and standards that maintain integrity. Auditors must raise the alarm in the event that their integrity is compromised so that they can perform the duty of informing the shareholders of the actual state of affairs of the company.
The auditing firm should have taken the initiative to inform the management of the existence f a fraud in the company. In the findings, the auditor should have disclosed fraud in the company through an audit opinion. The shareholders of the company would have found information on what was going on in the company and taken urgent measures to prevent further fraud. Such an action would have allowed the company to reduce its losses and avoid bankruptcy. The actions of the auditor indicated that the firm was compromised by the management to give an opinion that the financial statements were true to the best of their knowledge. The move to have the documents destroyed seeks to prevent being held responsible for failing to advise the company. In this case, the auditor should be sued for professional negligence that led to the company being declared bankrupt.
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