Assignment on A Hypothetical Case
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Added on 2021-02-20
Assignment on A Hypothetical Case
Added on 2021-02-20
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A Hypothetical Case based on NAB
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INTRODUCTIONAuditing is a procedure of analysing an organization (or individual's) fiscal informationto evaluate if there are reliable and as per the any applicable concept, modulate and laws (Cook,van Bommel and Turnhout, 2016). To conduct auditing appoint a persona who is qualified forthe job through statements, papers, information and comments received from the authorities. Theaim of the report to highlighted poor audit quality by Australian securities and investmentcommission. This report based on the Hypothetical case on National Australian Bank. In thereport covers professional, legal and ethical factors, statuary and professional ethicalrequirements. To identified the risk conduct SWOT and PEST of bank and calculate financialratio from the financial report. TASK(a) Professional, ethical and legal factorsTo continue the appointment as an auditor for the current year focus on the differentfactors like ethical, professional and legal factors such as Legal Factors – There are defined those factors that helps to conduct business activitieseffectively and affect to cultural of company. Such as – Did not take legal action forcompany due to mismatchment of accounts, provide freedom for develop financialstatements and conduct transactions. Professional factors – These factors important for conduct auditing of any company eventhey have personal relation. Such as – Does not apply all auditing standards, createpersonal relation and ignore irrelevant data. Ethical factors – In this factor fulfil all the requirements of auditing standards inappropriate manner. Such as – integrity, public interest, objectivity & independence After the analysis of all the factors it is understand that do not continue the appointmentas an auditor of EY for NAB. (b) Statuary and professional ethical requirementsAs per the media reports and financial reports it is identified that statutory and professionethical requirement become reason of breach. As per the revelation comes as leaked documentspresented that NAB had breached its own strategies on dealing with international sanctions on atleast three occasions (More and Chaudhari, 2016). Due to delayed of payment files leaked by a1
whistle-blower to the Sydney morning herald and the age breached the economic and tradesanctions on at least three occasions. The speaker said that BNZ did not any laws or internationalsanctions. The documents show that BNZ also processed a payment to recognised to be for oiloriginating from Iran. As per the article of senior NAB figure afraid withlarge hazard from Irancommercialism that group chief risk officer report told that NAB had no statutoryresponsibilities to disclose the Iran payment to the US Finance'sbranch of foreign assets control,which manage and influence as endorsement, but BNZ would disclose to the USD paymentclearer, “Subject to internal legal law”. In the context of professional ethical behaviour it is said by Whistle-blower that afterworking for many years in the financial services industry, I'm tried of turning a blind eye to thelies and unethical behaviour so executives can keep their bonuses. As per the financial reports, it is analysing that in the March 2019 half year, the profit ofstatutory had decreased by $82 million after security analysing and actual price. There isdetermining AASB 9 that related to financial instruments and relate to 1 April 2018 has impactedon the set of volatility of statutory due to some derivatives. After analysis the statutory andprofessional requirement from medial reports and financial reports it become reason of breachedfor NAB. (c) Major risk areasSWOT – It is a internal analysis which defined internal activities of the business. It carryout strength, weakness, opportunity and threat. Strength – NAB is leading Australian bank which provide services to many companies.The main strength of the bank is market strategies and easily track the record ofintegrating complimentary firms with the help of merger & acquisition. They arepreparing strong brand portfolio, distribution network, reliable suppliers and highlyskilled workforce with the help of training and learning programs. Weakness – There are considering many business risk in the company that impact of thecultural, brand image and other things. There is identified risk detention, inherent riskthat impact on the misstatement of financial statement. Into detection risk It is a kind ofaudit risk that is identified through SWOT analysis. There is a chance an auditor will notrecognise and accurate a misstatement in time before the audit (Simnett, Carson andVanstraelen, 2016). 2
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