Issues In Contemporary Auditing Part 1 A. Engagement Letter Audit engagement letter provides assistance in avoiding any confusion related to the engagement which might occur in the process of auditing. The engagement letter includes the documentation and confirmation of the auditor’s acceptance with regards to the appointment…
To The Audit Committee, The purpose of this letter is to invite the company i.e. KAZAKHMYS to involve in a relationship with our audit firm. It has been observed that the company KAZAKHMYS acts according to the rules and the regulations mentioned in Companies Act 1985. The company is one of the renowned natural resources group. The company wants our audit firm to do statutory audit and stock audit for their company. In relation to this, the company KAZAKHMYS needs to provide access to its accounting records as well as all the information which are needed to prepare the financial statements. The company must also provide access to the concerned persons who are required for gathering information with regard to the preparation of financial report within the organisation. In the context of this engagement relationship the auditor needs to follow certain statutory duties to ensure a long-term and healthy relationship between the concerned parties. Statutory audit scrutinises the books of accounts. The company has maintained transparency in their books of financial statement to reflect the company status to their stakeholders and shareholders. It follows books of accounts according to the standard mentioned in International Standard on Auditing (ISA). They have not limited themselves to ISA only rather they have taken into an account the workings of international auditing standards which is accredited under The International Auditing and Assurance Standards Board (IAASB). The company wants us to prepare a proper framework for upholding the books of accounts. KAZAKHMYS’ financial reports comply with the governance reporting. The investors relate with the information to judge the performance of the company. The scope of the audit for the company relates to the preparation along with presentation of the ‘accounting estimates’ according to the standards of ISA. Besides the financial report, a separate letter concerning with internal control systems and material weakness in the field of accounting would be provided to the company. Arrangements concerning to the availability of internal auditors and secondary auditors have been done by the company. The company has worked previously with the auditors with respect to ‘analytical procedures’. Our auditing firm will be highly obliged if you can look into said matter and in due course establish a long-term relationship with KAZAKHMYS. Sincerely, Manager Loughran and Shrives Chartered Accountants B. Ethical Issues Leaflet Ethics in relation to auditing states that quality auditing involves intensive scrutiny of organisation’s control systems with respect to quality. The various fields upon which an auditor’s ethical competencies or independence are judged are impartiality or integrity, consulting, a lack of compliance with the set standards, a lack of education in ethics along with denying access to premises and intimidation. In the context of impartiality, auditors who scrutinise the management of quality control can be bargained in relation to their powerful economic ties. Consulting explains that if an auditor is working for a firm which is into the services of non-auditing to a company, and quality control practices of that company are audited, quality of the audit can be bargained. This aspect also refers to auditor’ ...
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“Finance and Accounting: Contemporary Auditing Essay”, n.d. https://studentshare.net/finance-accounting/14740-issues-in-contemporary-auditing.
Contemporary Management Accounting System Table of Contents Overview 3 The Concept of Management Accounting 5 The Drivers for the Changing Role of Management Accounting Practices 7 The Contemporary Business Environment 8 Role of Management Accountants in Contemporary Organizations 10 References 14 Overview Anthony G.
In this process, it may happen that the transactions might have occurred after balance sheet date but before the issuance of the financial statement. This affects the financial statements and therefore adjustments are made and properly mentioned in the statements.
Contextually, in terms of both auditors and clients, this letter primarily depicts the terms and the provisions of the engagement where the purpose of the engagement and the terms of the compensation for the auditors are appropriately mentioned. The purpose of this letter is to establish an engagement relationship amid Hammerson plc, a FTSE listed company and Loughran and Shrives Chartered Accountants, who would act as an auditor for the company.
This paper attempts to explore this concern and discuss the contemporary issues by providing logical answers based on an analysis of the practical application of theories by scholars. Accounting is a legal framework which consists of laws, regulations and therefore accounting regulations is very important.
Whoever undertakes to audit the legal issues should have a clear target of evaluation and analysis. Should be bound to given cord of principals in his attempt to come up with the analysis and research (Guta, 2004, p.341). Some of the values expected of the professional accountants are integrity, having the objective in the work they undertake, practicing the independence during the execution of the duty, generating the confidence in the analysis they do, and also should show or should be a professional in the field of law.
A statutory auditor is a certified external auditor who has the statutory obligation to certify the accountability of the firm’s financial statements in accordance with professional auditing standards (European Commission 2011). In order to ensure stakeholder confidence regarding the transparency of the auditing process, it is necessary to promote the independence of statutory auditors.
During this period, a relatively small number of accounting firms could perform audits for a relatively large number of entities. Professional accountants and auditors could render reports on the financial performance of different entities and could work for different investor groups.
There may some benefits of concentration but concerns about high audit costs, lack of competition, and risks of destabilization of capital markets may prove fatal if emergent measures are not taken. Theses issues of audit
Other stakeholders in the business world believe that audit quality is reduced when rotating auditors due to the lack of familiarity about business processes and accounting, thus impacting the ability of auditors to
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