Independent Auditor Has Been Playing Term Paper

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During a routine investigation, one the actuaries discovers that there are some possible red flags for illegal activity. When they report these issues to their supervisors, they are told to not worry about that. What make this so troubling is auditors have an ethical duty, to protect the interests of their clients and the public. The problem is that they want to remain a part of the team. Yet, they also must ensure that they are not directly helping to enable fraudulent activities to occur. (Moyer, 2009, pg. 83)

In this particular case, the auditor is not completely independent from their clients. The best way to deal with these kinds of situations is, to bring these red flags to the attention of upper management inside the accounting firm. If there is no satisfactory response, the individual has an obligation to let regulators and the general public know about what is happening. This can be achieved by directly contacting regulators about these discrepancies. Moreover, auditors can recuse themselves from working with this client for ethical reason and contact the main stream press about the firm's activities.

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This will create a situation that will bring these issues to light. In the long-term this will protect investors, by providing everyone with a warning about possible questionable transactions. (Moyer, 2009, pg. 83)

Conclusion

Clearly, the research that was conducted is showing how auditors must be watchful of possible red flags. At the same time, they must maintain a sense of objectivity and professionalism during the process. This will avoid the issues of becoming too close with clients and supporting the unscrupulous activities of colleagues / supervisors. If this kind a focus is taken at all times, it will create standards that will ensure that everyone is following the different provisions of the law. Once this takes place, is when the auditor will serve their function of protecting the information that is provided to: the public and regulators. This is when everyone will have greater amounts of confidence in the companies they are working with and the public / private markets. (Moyer, 2009, pg. 83).....

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