MF Global Assignment Example | Topics and Well Written Essays - 1250 words

MF Global - Assignment Example A financial audit is therefore one of the assurance duties conducted by auditing firms. In case an organization engages external auditors, the level of responsibility of such auditors goes beyond the duties of the internal auditors. More importantly, the extent of the responsibilities of the auditors is defined by the International Standards on Auditing (ISA) (Haas, 2012). A fraud audit is conducted in instances where fraud is suspected in the financial statements and such auditing is therefore meticulously conducted by thoroughly reviewing the statements. In most cases, organizations conduct fraud audit just to ascertain that nothing suspicious occurs within the financial statements and to discover any misdealing before it is too late (Haas, 2012). An auditor conducting a fraud audit does not really conduct an investigation as might be supposed. Rather, it is just a way to identify any fraudulent transactions. The auditor traces each transaction in the statements for accuracy. Their duty transcends the ledger records in looking for fraudulent transactions in the financial statements. Any form of inconsistency in the financial statements can therefore help towards uncovering fraud in the organization (Haas, 2012). 2) Indeed, there is always a major issue regarding the responsibility of corporate CEOs on the financial activity of their organizations. In the case of MF Global, it was realized that several issues relating to accounting partly accounted for the bankruptcy of the organization. As the overall executive of an organization, it is imperative that the CEO is much abreast with all the financial activity in the organization. Considering that such financial scandal can lead to the collapse of the organization, it is important for the CEO to be much aware of the financial activity of the organization. The stakes