Auditing and Assurance Services

Running head: AUDITING AND ASSURANCE SERVICES 1
Auditing and Assurance Services
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AUDITING AND ASSURANCE SERVICES 2
Introduction
The Australian Auditing Profession (AAP) functions in the paradigm of the co-regulation
framework. The three greatest professional entities, The CPA Australia (CPAA), Institute of
Chartered Accounting in Australia (ICAA), and the National Institute of Accounting (NIA)
have presented standardize guidelines surrounding ethics, which control the conduct of
members of the Auditing Professionals. In that regard, this paper presenting the rational of
accounting firms being placed under the banking royal commissioning, accounting to the
assumptions made by a British investigation journalist. To critically answer the auditing
concerning, this paper analyses the challenges and opportunities of the AAP as evident in the
21st with consideration to the recent regulation attempts purposed to enhancing the quality of
auditing in Australia. Various cases and examples will be utilized to evaluate the relevant
issues concerning the AAP.
Do you agree or disagree with the above? Discuss your reasons for doing so.
The statement under analysis is the:
“Australia's "big four" accountancy firms should be put under the spotlight of the
banking royal commission, according to a British investigative journalist who has
written an exposé on their activities overseas” ("Accountancy firms 'should get forensic
treatment at banking inquiry'", 2019).
In reference to the above statement, I totally agree to it because various behaviours and
practices of the ‘big four’ accounting firms should be subjected to forensic consideration as
Australia Banks. According to Costello & DelCore (2014), the profitability of accounting
firms and how their manage their business operations presents a significant conflict of
auditing interest due to the activities, which sells consultancy operations to various entities

AUDITING AND ASSURANCE SERVICES 3
whose accounting frameworks are purposed to be individualistically auditing. The firms’
fundamental interest is not obtaining the quantities correctly, but getting the funds for the
purposed interests of themselves, which resultantly have a significant implication of the
global financial health. In reference to Hecimovic, Martinov-Bennie & Roebuck (2009),
activities of accounting firms should have been spotted earlier by the relevant auditors if the
reasons for the recent financial crises when entities sold ridiculous sub-prime properties are
considered.
Discuss the opportunities and challenges for the Australian auditing profession in the
21st
Century
The AAP in the 21st century is faced with challenge, in addition to the relevant opportunities
for improvement. Moreover, the accounting industry is shaken by development of the
accounting software, aspect of globalization and transitions in the accounting regulations
("How AI will enable us to work smarter, faster", 2019). These changes and challenges also
offer a framework for opportunities to be considered by the AAP and the necessity to adopt
them.
Opportunities
 Opportunity for growth – The significance of accounting is not expected to diminish.
To assumption is supported by an example of auditing research conducted by the
Buraau of Labor Statistics, which projected that approximately 13% growth rate is
expected from 2012 to 2022. This estimation equates to the overall growth evaluation
of job sections in the accounting world. Therefore, firms have an opportunity to
formulate accounting statements for the relevant investors. The respective

AUDITING AND ASSURANCE SERVICES 4
corporations handling and regulating financial frameworks consider auditors apply the
new accounting standards. As such, companies borrowing funds require these auditors
to substantiate the worthiness of these credits whereby the greater the firm, the more
complex the auditing of the finances will be for auditors.
 The cloud opportunity – The AAP has a chance to advance and make use of cloud
accounting used to store information in a remote server. Resultantly, firms are
exposed to an opportunity to make geographical location of data irrelevant since the
accounts are safely encrypted in cloud. Once a company computes its accounts in the
cloud store, the accountants can operate on them anywhere. This provides the
business with more flexibility since they will be able to do their work any time.
According to Imhoff (2003), cloud computation carries minimal risks; like the need to
select the cloud storage firms for the business and clients. These cloud storage firms
should guarantee safety for the stored data.
Challenges
 Choosing the best software package – Accounting software has the ability and
flexibility to enable the auditors to record expenses and income. These financial
software operate on spreadsheets and taxes meant to evaluate firms’ future
expenditure. However, choosing the correct software packages capable of dealing
with vast book-keeping is not easy due to the completion evident in the AAP. An
example of this case is evident in firms expecting their internal accountants to expand
their obligations, which surpass accounting compliance as well as considering risk
management frameworks.
 Globalization is also another key challenge in the AAP. As firms continuously
consider globalizing to other nations, auditors have to adjust their operations
accounting the multiple financial systems globally (Imhoff, 2003). Currently, the