Sample Assignment on Auditing PDF

Added on - 12 Sep 2021

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Running head: AUDITING
Auditing
Name of the Student
Name of the University
Author Note
Table of Contents
Introduction:...............................................................................................................................3
Article Summary:.......................................................................................................................3
Article Analysis:.........................................................................................................................4
Conclusion..................................................................................................................................5
References:.................................................................................................................................6
Introduction:
The chosen article for this report is“Could perverse incentives encourage financial
services compliance and internal audit staff to ignore or engage in illegal behaviour?”
written by Michael & Williams (Michael & Williams, 2018). This report will analyse this
article further after providing an appropriate summary. The chief motive of this chosen article
is to understand that why managers along with internal auditors and compliance staff try to
ignore compliance related legislation. The entire discussion is based on Malaysia.
Article Summary:
The researchers have tried to understand the activity of financial services, compliance
staff as well as internal auditors when political, economic and structural incentives act against
compliance based on antitrust law of the country. In the USA and EU, fixing of inter-bank
rate, blocking of derivatives exchanges coming from the swap business related to credit
default along with other scandals can be considered. In these situations, various scandals have
highlighted that incentives obtaining for engaging with anticompetitive behaviour can
defiantly exist in the sector of financial services (Rodriguez Castro, Ruiz Barbadillo &
Biedma López, 2017). According to theory, lawmakers receive very small amount of
incentives for encouraging this kind of behaviour. Moreover, regulations can implement huge
amount of sanction to discourage equilibrium related to anticompetitive behaviour within
providers of financial services. However, instead of this basic theory, law often provides
incentives to banks for engaging in anticompetitive behaviour. In this context, it needs to
mention that compliance staffs as well as internal auditors encourage this anticompetitive
behaviour. The researchers have observed a theoretical possibility in the context of Malaysia.
In this country, optimal expenses based on antitrust compliance as well as equal equates with
zero. As banks spend money for audit and compliance, they are required to follow illegal
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