This thesis aims to answer whether the auditor obligation (revisorpligt) will have a positive effect on mistakes and fraud with tax and VAT. The research in this thesis comes from current legislation, governmental agreement regarding auditor obligation and interviews with relevant stakeholders.
The current legislation includes the auditors act. and the possible auditors’ statements in a annual report here under what kind of reporting obligations the auditors have for each auditor statement.
To examine the issue of the thesis, the thesis must describe the agreement of auditor obligation and what kind of effects the agreement will have on the Danish companies. Beyond the understanding of the agreement regarding auditor obligation the thesis will also need to include compliance survey from the Danish Tax Agency which includes calculations of the average misstatements in companies with or without an approved auditor statement in the annual report. This survey concludes that there’s significant fewer misstatements regarding tax and VAT in annual reports which includes an auditor statement compared to annual reports which does not include an auditor statement.
The thesis further includes description of the tax and VAT gap. Description of the expectation gap, between the level of security the Danish politicians expect in the statement of assistance (assistanceerklæring) and the real level of security as the statement of assistance includes.
Based on the interview with the different stakeholders the thesis includes an alternative solution proposal the minimize the misstatements and fraud with tax and VAT. The alternative solution main difference from the auditor obligation is the risk parameter and that the companies does not have a free choice when it comes to selecting the auditor statement. This means that risk parameter in the auditor obligation the “risk industries” will be shifted to the risk parameter bank debt. The free choice of auditor statement is suggested to be shifted to an audit statement.
The thesis concludes that a statement of assistance can have a positive effect on the companies which will be covered by the auditor obligation. The conclusion is based on surveys concluding that it’s more important to have any of the possible auditor statements, than a specific auditor statement to prevent misstatements and fraud with tax and VAT. Further the thesis concludes that the agreement of auditor obligation is a small and unambitious agreement since the agreement only will cover around 700 companies.