Audit, Assurance and Compliance

Running head: AUDIT, ASSURANCE AND COMPLIANCE
Audit, Assurance and Compliance
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AUDIT, ASSURANCE AND COMPLIANCE
Contents
Issues:..............................................................................................................................................2
The root cause of the issue:.............................................................................................................3
References:......................................................................................................................................5

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AUDIT, ASSURANCE AND COMPLIANCE
Cam & Bear Pty Ltd v McGoldrick [2016] NSWSC 1894
In the above case the New South Wales court of appeal was responsible to provide its verdict on
the role and responsibilities of an SMSF auditor, John McGoldrick for the losses caused to an
SMSF. An in-depth discussion on the above case will be helpful in understanding the issues of
auditing and accounting raised in the case.
Issues:
The main issue in Cam & Bear Pty Ltd v McGoldrick [2016] NSWSC 1894 was that of
negligence on the part of the auditor of SMSF. Cam and Bear Pty Ltd sued McGoldrick for being
negligent, misleading and deceptive in his conduct and asked the NSW court to consider the facts
of the case. The case dealt with certain specific issues in relation to the auditing and accounting
of funds, these are discussed here (Cam & Bear Pty Ltd v McGoldrick [2016] NSWSC 1894,
[2016]).
Auditors must be appointed at every annual general meeting to ensure transparency of
appointment: Auditors must be reappointed at every annual general meeting and should not be
given long term appointment. This will increase transparency in appointment and make the
auditor more accountable towards his duties.
Auditors should not be negligent in discharging his duties and responsibilities: In this case the
auditor was certainly negligent towards his duties as he failed to take necessary steps and
procedures required to conduct the audit of SMSF (Cosserat and Rodda, 2009).
Failed to recognize important and crucial developments: Few years after the establishment of the
fund, a close friend of Dr Bear took the initiative to manage the investments of the fund. In