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Assurance, Audit and Compliance - Assignment

   

Added on  2021-06-16

17 Pages4084 Words22 Views
Running head: AUDIT, ASSSURANCE AND COMPLIANCEAudit, Assurance and ComplianceName of the StudentName of the UniversityAuthor Note

AUDIT, ASSURANCE AND COMPLIANCE1Executive SummaryThe purpose of this study is to review the auditors report of an ASX listed company. The company chosen for this study is Commonwealth Bank. It aims to analyse the declaration of auditors and assert the opinion provided by the auditor in the auditors report. It reviews the various auditing and non auditing services provided by the client. This study also analyses therole and functions of the audit committee of the company in question and the members thereof. It analyses whether the auditor has complied all the requirements and proper legislations in formulating an opinion on the financial statements and the key audit matters ofthe company. It also aims to make an analysis of the auditors remuneration and the percentage changes compared to the last year.it also aims to summarise the material subsequent events and makes an assessment of the effectiveness of the financial statements provided by the auditor.

AUDIT, ASSURANCE AND COMPLIANCE2Table of ContentsIntroduction................................................................................................................................3Discussion..................................................................................................................................4About Commonwealth Bank..................................................................................................4Auditor’s Independence Declaration......................................................................................4Independent auditor’s report..................................................................................................4Non Audit Services performed by the auditor.......................................................................4Auditor’s remuneration..........................................................................................................5Role, composition and functions of the Audit committee......................................................6Independent Auditor’s report to the shareholders..................................................................8Basis for opinion....................................................................................................................8Independence..........................................................................................................................9Audit approach.......................................................................................................................9Key audit matters...................................................................................................................9Difference of management and auditor’s responsibilities in relation to the financial report..............................................................................................................................................11Material Subsequent events..................................................................................................11Effectiveness of the material information............................................................................12Lack of Material information...............................................................................................12Conclusion................................................................................................................................13References................................................................................................................................14

AUDIT, ASSURANCE AND COMPLIANCE3IntroductionThe International Auditing and Assurance Standards Board has implemented a host ofreforms that have been intended to improve the utility and transparency of auditor report.These variations have been in effect since 15th December, 2015.Through the existence of theauditor’s report, the standard report enclosed a host of recommendations on how to bettermanage the exposure of auditors to litigation(Morley 2016.). However as a result of thefinancial crisis that engulfed the globe, investors had to take a step back. They felt that theyshould have been warned of corporate failures prior to the crisis. The investors now demandmore stringent examinations of financial statements by auditors. Under this new enhancedreporting, the auditors will need to deliver more evocative discernments into the audit(Kachelmeier,Schmidt and Valentine 2017). This can be done through customiseddisclosures. Diclosures of this nature will facilitate an open communication between auditorsand investors. The auditor’s opinion will be presented first. This will be followed by thesection contining the basis for opinion of the auditors report . There will be a new section,that will be made mandatory for listed entities (Newton et al.2015). This new section willsummarise key audit matters . it is also compulsory for auditors to include a separate sectionThis section is called the material Uncertainty section about the going concern risk of thecompany. In this section there is an uncertainty regarding the ability of the entity to continueits current form . This requires the management to make adequate disclosures in respect ofthis matter.Auditors are also required to include an independence statement. This will declarethe fact that the auditors have satisfied all their ehical responsibilities (Yu et al.2018). Thereport analyses the effectiveness of the extended audit reporting procedures of the companyCommonwealth Bank.

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