The aim of this paper is to point out the importance and role of audit in a market economy on the basis of economic theory as well as on a real example from the Republic of Croatia. Today, most high-income countries base their economic regulation on market principles. The main role in such systems is played by companies and individuals who make rational decisions about the allocation of limited resources. Companies are required to report publicly on the financial performance and condition of their business, and the role of audit is seen in confirming the accuracy of this information in order to create the preconditions for making rational economic decisions. The paper explains the role of audit for various stakeholders, such as owners, management, creditors, and others. Based on a recent example, the role of audit in the emergence and resolution of the crisis situation of the former largest business entity in the Republic of Croatia is investigated. This research leads to the conclusion that the audit of financial statements plays a central role in establishing the functioning of the market economy based on the fact that the long-term auditor of the Agrokor Group, Baker Tilly Hrvatska d.o.o. produced audit reports that presented the financial situation and results of the Agrokor Group in a false, better light than the actual situation and thus directly contributed to the sudden, rapid and crisis collapse of the Agrokor Group. Unlike the presentation of a company that consolidated a positive business result, had positive reserves or capital, a subsequent financial audit that was conducted by PricewaterhouseCoopers d.o.o. showed that the Agrokor Concern actually generated losses, had a significantly smaller amount of money in the account, had negative capital in the form of accumulated deficit, i.e. was significantly over-indebted and liabilities and financial expenses were not shown in full.