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Auditing Theory and Practice: PDF

   

Added on  2021-06-18

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Auditing Theory and Practice1

Executive SummaryThe report is developed to provide an analysis of the implications of ASX CorporateGovernance Principle on Westpac Bank Corporation, an ASX listed entity. It has been depictedthat the bank effectively complies with the corporate governance statement framework that hasenabled it to achieve long-term growth and development. Also, the risk assessment proceduresimplemented as per auditing standard for identifying the audit risk has assed that it hasimplemented effective strategies for mitigation of audit risk and also it nature of operations andfinancial performance is associated with minimum chances of facing any audit risk. 2

ContentsImplication of ASX Corporate Governance Principles for BHP Billiton.........................................................4Developing Solid Framework for Management & Oversight...................................................................4Structure the Board to Add Value............................................................................................................5Ethical and Responsible Way of Acting....................................................................................................5Safeguarding Integrity in Corporate Reporting........................................................................................5Making Timely and Balanced Disclosure..................................................................................................6Respecting the Security Holders Rights...................................................................................................6Risk Identification & Management..........................................................................................................6Fair and Responsible Remuneration........................................................................................................7Risk Assessment process of the Westpac Bank...........................................................................................7Nature of Entity...............................................................................................................................7Market Analysis:..............................................................................................................................8Business Strategy:............................................................................................................................8Analytical process............................................................................................................................8Computation of Income & Balance Sheet Ratios.....................................................................................8Audit Risk & Its mitigation.....................................................................................................................10References.................................................................................................................................................113

Implication of ASX Corporate Governance Principles for BHP BillitonThe ASX Corporate Governance council has released its principles and recommendationsof corporate governance for meeting the diverse needs and expectations of the shareholders.ASX has directed all the business entities listed on ASX to develop its corporate governancestatement as per the standard principle and recommendations. This is done to improve thetransparency in the business processes and achieving the trust and satisfaction of thestakeholders. Westpac Bank, an Australian bank a financial service provider involved inproviding various types of innovative financial products and services for personal , business orcorpora banks. The bank listed on ASX is committed to highest level of governance and seeks todevelop a culture that promotes highest level of ethical standards and corporate integrity. Thebank also developed a statement of governance as per ASX principles that can be analyzed asfollows:Developing Solid Framework for Management & OversightASX listed entities need to develop a sold foundation for management by establishing adequatelythe respective roles and responsibilities of the board and the management personnel. In this context,Westpac has developed and disclosed its Board Charter in the corporate governance statement that hasoutlined the roles and responsibilities of the Board. It includes overseeing the management of the bank,providing strategic evaluation of the performance of Board members, determining the remuneration of thekey management personnel and so on. The key management personnel are directly accountable to theBoard and carries out several functions in relation to managing the day-today activities of the bank. Also,there is an established procedure according to council principles for over-viewing the performance ofBoard and management. The Board performance is monitored annually by a self-assessment process insupport of an independent consultant. The results obtained are reviewed by its overall members and arediscussed with the Chairman of the risk committee. The standard measures for evaluating theperformance of management are established by the board. The performance of Board is ensured inrelation to the standard objectives determined as per the remuneration policy or practices on an annulbasis. Therefore, it can be said that Westpac effectively complies with the ASX Council standardprinciple of developing a solid framework for management and oversight (2017 Westpac GroupCorporate Governance Statement, 2017).4

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