First and foremost external financial auditors audit a companies' financial statements for material misstatements, that is primarily what they do. Not to specif

First and foremost external financial auditors audit a companies' financial statements for material misstatements, that is primarily what they do. Not to specifically identify fraud, unless they're brought in purely for a fraud related matter. As part of the audit process the auditors assess the risks of fraud including management override of controls and build this into their audit plan. But external auditors are not required to find fraud, but may find it through their audit procedures. Audit firms operate on trust and there are many many steps that are required to ensure a level of independence of the staff and the partners involved. The penalties associated with poor auditing are usually significant and when quality issues are identified partners are often penalised financially. You can't pay auditors by the fraud discovered as that's in fact not what they're actually there for in the first place. However, they may identify instances of fraud as part of audit procedures as part of identifying material misstatements.