Abstract
This article discusses some of the highly topical issues linked to financial crises, bank losses and audit. In addition to a theoretical discussion of the recent bank losses and financial turmoil, our analysis of a 10-question questionnaire indicates, as in the work of Stonham (Citation1996), strong evidence of auditing weaknesses and erroneous management decisions that explain such bank losses. Our analysis also highlights the fact that trading and arbitrage are riskier and more hazardous during periods of crises.
Notes
1The questionnaire and the details of the answers are not reported but may be obtained upon request.
2This result is in line with that of Stonham (Citation1996).
3This may be because of the fact that some managers lacked experience and were not sufficiently supervised.
4Eurex is a subsidiary of Deutsche Börse and SWX.