Final answer:
The auditor's responsibility for detecting employee fraud and errors is equally distributed. Auditors must remain professionally skeptical during audits and assess risks for fraud and errors to determine the extent of audit procedures required. The challenge of reporting misconduct can be substantial for both auditors and internal employees.
Step-by-step explanation:
When comparing the auditor's responsibility for detecting employee fraud and for detecting errors, the profession has placed the responsibility equally on discovering either one. Auditors are expected to approach an audit with professional skepticism, which means they must be alert to the possibility of errors and fraud during the audit process. However, it is also recognized that the auditor may not detect all frauds, especially those that involve sophisticated and organized schemes or collusion among employees.
The responsibility for detecting both employee fraud and errors is based on the risk assessment conducted by the auditor as per the standards. If the auditor assesses that the risk of fraud or error is high, more audit work may be done in those areas. Regardless of the nature of the misconduct, the challenge for auditors and employees within organizations is substantial due to the potential personal risks of reporting such issues, which can lead to resistance from within.