ACC300 Auditing and Assurance Services: Ethical Violations Analysis

This assignment solution delves into the ethical principles of auditing and assurance, referencing Accounting Professional and Ethical Standards (APES) to evaluate potential violations. It analyzes three scenarios involving a senior auditor receiving discounted tickets, an auditor with prior experience in a similar company, and a chartered accountant recommending a system installation expert. The analysis identifies potential conflicts of interest, threats to objectivity, and compromises to professional competency and due diligence. By examining each situation against the backdrop of ethical guidelines, the assignment provides insights into maintaining integrity and public interest in auditing practices. Desklib provides a wide array of study tools and solved assignments for students.

AUDITING AND ASSURANCE
AUDITING ETHICAL PRINCIPLES
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AUDITING AND ASSURANCE
According to Accounting Professional and Ethical Standards (2013.Pg.5), APECS are
guidelines that require all certified public accountants and auditor act in a responsible, objective,
professional competency, integrity, due diligence and lastly the act of minding the public interest
of the concern parties in their needs. The items in question a, b and c revolves around the above-
highlighted traits.
(a)In this first scenario Peter Sung a senior auditor is offered a ticket at a discount of
25% by the same company that he provides audit services. The fact that Peter is offered the ticket
at a discount by his client, a principle of conflict of interest as well as self-interest arises.
However, it depends on the way the following principle of self-conflict interest affects the
objectivity aspect of conducting the audit service.
Ideally, if this offer discount and the pre-booking consideration is given to Peter just as
any other regular customer of The Musical Company Ltd is presented in a nutshell there exist no
violation of the objectivity and integrity trait (Martinov-Bennie, Cohen and
Simnett,2011.Pg.660.)However, if it is only done to Peter because of their long-term relationship
and not by the policy of the company then there is the violation of objectivity and integrity of
Peter audit service will be compromised due to self-conflict interest.
(b)The fact that Jane Went is an auditor of Gerroa Company and seems to have any
stake in this company there is no violation of any ethical principles, just because what is doing is
just rendering his professional competency skills he learned in his 3years audit service he offered
in a similar field to this one of Gerroa Company. In any case, there are no signs of Jana showing
to compromise the operations of the new client Gerroa hence no violation of any ethical principle
is witnessed (Davies and Aston, 2017.Pg.7.)

AUDITING AND ASSURANCE
(c)Daka Jack is a chartered accountant and not a system installation expert thus the fact
that he knows he is not an expert he would inform the client to avoid compromising his
professional competency and more so objectivity threat on the system installation since his
referral to the system expert who is acting on his behalf and not on himself(system expert)
creates an aspect of conflict of interest (Kaidonis,2008.Pg.10)whereby in case the client does not
have time to check the status of the job done he may opt to approve it or even hide anything that
may deny him the referral or commission fee he will be getting hence compromising his integrity
and due diligence care of his work.

AUDITING AND ASSURANCE
References;
Accounting Professional and Ethical Standards Board (APESB), 2013. APES 110 Code of Ethics
for Professional Accountants.
Davies, M. and Aston, J., 2017. Auditing fundamentals. Pearson Higher Ed
Kaidonis, M., 2008. The Accounting Profession: Serving the public interest or capital
interest?. Australasian Accounting, Business and Finance Journal, 2(4), p.1.
Martinov-Bennie, N., Cohen, J. and Simnett, R., 2011. Impact of the CFO's affiliation on auditor
independence. Managerial Auditing Journal, 26(8), pp.656-671.