Changing Auditor Mindset Is Crucial To Fraud Detection, SAG Panelists Say

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Nov. 26 — A total change in mindset by auditors is necessary for them to detect fraud, several panelists suggested at the Nov. 20-21 meetings of the Public Company Accounting Oversight Board's Standing Advisory Group.

Nonforensic auditors need to develop the “underbelly of accounting fraud” mindset and approach of the forensic accountant, said Philip Kruse, forensic accountant and PCAOB standing advisory group panelist, during the SAG meetings in Washington.

Panelists suggesting the change in focus consisted of experienced forensic accountants, academics who research cognitive biases, and attorneys investigating financial fraud.

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