Today, micro, small and medium-sized enterprises account for more than 90% of the share of business in the entire economy of Croatia. Small and medium-sized entrepreneurs unite a large number of subjects in various activities, coordinated through different legal segments. The most represented organizational forms of small and medium-sized enterprises are trades, joint-stock companies, limited liability companies, simple limited liability companies and partnerships. The operation and functioning of these companies bring with them numerous benefits and restrictions. In the Republic of Croatia, small and medium-sized enterprises comply with the Croatian Financial Reporting Standards and the Accounting Act. Accounting has a very important role within the company because it monitors the company's operations with the help of financial statements. The complexity of financial reporting regulations and the disproportionate administrative burden, depending on the size of the company, is a segment of many scientific and professional seminars. The quality and reliability of financial statements is ensured by auditing. An audit can detect and locate significant fraud and/or manipulations that can render financial statements unusable in such a way that they are not reliable and do not show an objective and fair state and result of the company's operations, which are actually important for the decision-making of users of financial statements. Small and medium-sized enterprises have fewer resources at their disposal, fewer formal procedures, internal controls, if they exist, are represented in a smaller proportion, operate "on the basis of trust" and are generally less aware of their vulnerability to fraud. By respecting sustainable ethical standards and applying standard audit procedures, external auditing ensures quality financial statements and gains and maintains public trust in the company's financial statements. The main goal of the research is to determine the perception of small and medium-sized enterprises about manipulations on financial statements using an anonymous questionnaire.