Why Do Auditors So Rarely Find Fraud?

Are we just reading the wrong newspapers and reports or does it seem that auditors—although they spend hours and hours performing audits—rarely identify instances of fraud? Most companies rely on their auditors to uncover irregularities and breathe a sigh of relief when the audit comes up "clean."  Is that reliance misplaced? Probably so, according to this article from CFO.com. "Audits almost never find fraud," the author writes; the data shows that " external audits find it 4% of the time, and internal 15%."  Instead, the author suggests, to detect fraud, management should look in a different direction.

The author, Tiffany Couch, CEO of Acuity Forensics, suggests that the notion of a "clean audit" is widely misunderstood: