MF Global

Discuss the key difference between conducting a financial audit and a fraud audit, and the related level of responsibility of the auditing firm.

Financial audits are typically carried out by certified public accountants or outside agencies or firms that work directly on behalf of individual companies. At times financial audits may be initiated by government entities. The audit itself is more of a "double-check" of financial reports and practices (Weinberg, 2003). Financial audits are deemed complete upon verification that numbers are accurate. Completed financial audits may prove or disprove information, but discrepancies will typically not result in the same serious consequences as those uncovered during a fraud investigation or audit.

Fraud auditing usually comes at the demand of the U.S. court system - usually the work is carried out by the government or privately-held third parties. Fraud audits look for dishonesty and hidden figures. They probe deeper than...
[ View Full Essay]