Auditor's Role in Connection to Money Laundry

Abstract

The purpose of this paper is to examine how the auditors are living up to their role as the representative of the public in connection to the anti-money laundering and how the Danish Business Authority controls that the auditors are compliant with the regulation. At first the money laundering and the impact on the global economy will be explained. Second the auditors role due the anti-money laundering will be explained due to the regulatory requirements for money laundering. Afterwards there will be an analysis of how the auditors fulfill the regulatory requirements and how the auditors experience the control from the Danish Business Authority, compared with the public decisions and judgments from the inspection visits. Here after there will be a discussion of how the impact from the auditors can be improved in connection to the anti-money laundering.
The research is done primarily by interviewing auditors and business consultants from different audit firms of different size. These interviews are compared up against a questionnaire survey targeting auditors employed at approved audit firms and data from the Danish Business Authorities website where all decisions and judgments are published. Other than that, the paper has gathered information from different types of other scientific papers and articles. This is done to ensure the professionalism at the auditors and to gather information about the anti-money laundering.
The finding of this paper shows that the Danish auditors are on the right course in terms of being compliant with the money laundering legislation, but also that there are still some areas that needs to be improved. Auditors comply with the regulation requirements, but in some earlier cases the auditors have hesitated to file a report, when they have come around something suspicious in connection to money laundering, and the report is first filled when there is an increased change that the client have done or will do a violation regarding to the money laundering. This is still the problem in some companies along with other violations as the sequence in the “know your costumer” procedure. But the main issue is for the audit firms to have the common thread between the overall risk assessment and the risk assessment at customer level.
To keep up with the money laundering the recommendation due this paper would be to invest more in education of the public approved auditors, even make it mandatory as a part of their after education. This will also improve the education of the employee in the companies, which will give them a better understanding why the actions due the anti-money laundering law are important. Future research should follow and examine the development of money laundering to make sure that the right improvements are made to the anti-money laundering area.