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Audit, Assurance and Compliance : Report

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Added on  2020-05-28

Audit, Assurance and Compliance : Report

   Added on 2020-05-28

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Audit, Assurance and Compliance1
Audit, Assurance and Compliance : Report_1
Executive SummaryThe report has been developed for gaining an understanding of the corporate governanceframework of business entities listed on ASX. The business entity selected for the purpose isCommonwealth Bank, a multinational bank of Australia having businesses across the US, theUK and Asia. The corporate governance framework of the banking institution is analyzed incontext of the ASX corporate governance rules and principles. Also, the report has conducted arisk assessment of the banking institution to identify the audit risk so that necessary steps can betaken for reducing the risk that can have a materialistic impact on the financial informationdisclosed to the end-users. 2
Audit, Assurance and Compliance : Report_2
ContentsImplication of ASX Corporate Governance Principles..................................................................................4Presence of Solid Framework for Management & Oversight..................................................................4Structuring the Board to Add Value.........................................................................................................4Ethical and Responsible Way of Acting....................................................................................................5Safeguarding Integrity in Financial Reporting..........................................................................................5Making Timely & Balanced Disclosure.....................................................................................................5Rights of Security Holders........................................................................................................................6Recognizing & Managing Risk..................................................................................................................6Fair & Responsible Remuneration...........................................................................................................6Risk Assessment..........................................................................................................................................7Nature of Company.................................................................................................................................7Market Overview of the Company..........................................................................................................7Computation of income statement and balance sheet ratio.......................................................8Audit Risk and the measures for their Mitigation....................................................................................8Conclusion...................................................................................................................................................9References.................................................................................................................................................113
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Implication of ASX Corporate Governance PrinciplesASX has laid the foundations of Corporate Governance principles that the businessorganizations in Australia listed on the stock exchange need to adopt for promoting transparencywithin the business operations. Commonwealth Bank involved in financial products andsservices need to place large emphasis on developing an effective corporate governanceframework to protect the interests of investors. The analysis of corporate governance statementof the bank as per the ASX principle is carried out as follows:Presence of Solid Framework for Management & OversightASX Corporate Governance Statement (CGS) has directed the business entities listed onASX to establish the clear roles and responsibilities of the board and management. Also, itshould adequate disclose the process selected for monitoring and evaluating their performances(Plessis, McConvill and Bagaric, 2005). In this context, Commonwealth Bank has clearlydefined the board roles and responsibilities sin its corporate governance statement. The role ofBoard is to provide an overall strategic direction to the Group on the behalf of the shareholders.The major responsibility of the Board is to develop the overall strategies of the Group andappoint, monitor and regulate the performance of the Key Management Personnel (KMP). Themanagement role is to regulate the daily activities of the banking institution as per the long-termgoals and objectives. The CEO is accountable to the Board and carries out the responsibility ofdesigning and implementation of a system to manage the material business risks, achievecustomer satisfaction and developing a healthy workplace environment. The Board reviews itsperformance on an annual basis through the development of a Board Committee in support of anexternal consultant (2017 Corporate Governance Statement, 2017). The Board has developedremuneration committee for monitoring and evaluating the performance of Key ManagementPersonnel. Therefore, the bank has effectively complied with this ASX CGS principle (ASXCorporate Governance Council, 2014).Structuring the Board to Add ValueASX listed entities should effectively structure the Board to include diverse skill set andexpertise to effectively meet its different roles and responsibilities. As analyzed from thecorporate governance statement of the banking corporation, it has ensured that Board carries out4
Audit, Assurance and Compliance : Report_4

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