Auditor’s Public Interest Responsibilities Report 2022

Running head: AUDITOR’S PUBLIC INTEREST RESPONSIBILITIES AND AUDIT QUALITY
Auditor’s Public Interest Responsibilities and Audit Quality
Name of the Student
Name of the University
Author’s Note

1AUDITOR’S PUBLIC INTEREST RESPONSIBILITIES AND AUDIT QUALITY
Executive Summary
This report indicates that the presence of material misstatements in the financial
statements distress the decision-making procedure of the company’s key stakeholders. In
addition, auditor independence and whistlowing is associated as it provides major
assistance to the auditors to maintain the public interest requirements during auditing. The
auditors can increase certain knowledge from the collapse of Enron. Moreover, the audit
firms are needed to develop the audit quality to keep away from the collapses like Enron.

2AUDITOR’S PUBLIC INTEREST RESPONSIBILITIES AND AUDIT QUALITY
Table of Contents
1. Introduction............................................................................................................................3
2. Analysis of Key Stakeholders of CSL Limited..........................................................................3
3. APES 110 Public Interest Requirements.................................................................................5
4. Audit Lessons from Enron Scandal and Arthur Anderson’s Behaviour..................................6
5. Audit Quality and Steps need to be taken for Addressing the Waring Note.........................9
6. Conclusion............................................................................................................................12
7. References............................................................................................................................14
8. Appendix..............................................................................................................................17

3AUDITOR’S PUBLIC INTEREST RESPONSIBILITIES AND AUDIT QUALITY
1. Introduction
In the process of auditing, the responsibility of the auditors is thoroughly and
independently inspects and examines the accounting records and financial statements of
the audit clients in order to make sure that they are free from material misstatements
(Louwers et al., 2015). In this process, the responsibility of the auditors is to ensure the
truthfulness and fairness of the financial reports of the clients. Performing quality audit
helps the auditors to gain sufficient assurance on whether there are any material
misstatements in the financial statements or not (Knechel & Salterio, 2016). While
conducting audit of the companies, the auditors must be accountable for the fact that they
represent the interest of public, not the audit clients. This particular aspect puts the
obligation on the auditors to make adherence to the principle of auditor independence and
professional scepticism (Chan & Vasarhelyi, 2018). In case the auditors of the companies fail
to perform quality audit, the proportion of accenting as well as financial frauds in the
companies can increase that is not good for financial reporting. The main objective of this
report is the analysis of the topic of public interest responsibilities of the auditors for
increasing the quality of audit.
2. Analysis of Key Stakeholders of CSL Limited
It needs to be mentioned that the key stakeholders of the companies can get
affected in the presence of improper identification, disclosure and adjustments of material
misstatements in the financial statements. The following discussion shows the impact of
materially misstated financial statements on the key stakeholders of CSL Limited:
Investors and Shareholders: It can be observed from the appendix that investors or
shareholders are one key stakeholder group of CSL Limited as this stakeholder group has