Comprehensive Report: Audit, Assurance, and Compliance at Suncorp

This report provides a detailed analysis of the audit, assurance, and compliance practices of Suncorp Group Limited, focusing on the role and responsibilities of auditors in maintaining stakeholder trust. It examines the auditor's independence declaration, the independent auditor's report, and non-audit services performed by KPMG, including tax compliance and wealth maximization strategies. The report highlights the differences in responsibilities between directors and auditors regarding financial reports, auditor remuneration, and the composition of the audit committee. Key audit matters and associated procedures are reviewed, emphasizing the auditor's role in identifying and mitigating risks related to financial misstatements and ensuring compliance with Australian Accounting Standards and Corporations Regulations. The analysis includes a review of remuneration changes for non-executive members and auditors, and the functions of auditors in protecting stakeholders' interests and ensuring transparent financial reporting. Desklib provides access to this and other solved assignments for students.

AUDIT, ASSURANCE AND
COMPLIANCE

Audit, Assurance and Compliance 1
Executive summary
This report has the detailed information of working of auditors of a particular company
“suncorp group limited”. The report has the exclusive information of financial information of
the company through independence report on auditors. Moreover, identigying the role,
function and responisibility is another important activity that is being described in this report.

Audit, Assurance and Compliance 2
Contents
Executive summary...............................................................................................................................1
Introduction...........................................................................................................................................3
Introduction of the company..................................................................................................................3
Auditor’s Independence Declaration.....................................................................................................3
Independent auditor’s report..................................................................................................................4
Non-Audit services performed by the Auditor.......................................................................................5
Director responsibility differs from Director to Auditors in regards to financial reports.......................6
Auditors’ remuneration..........................................................................................................................6
Role and responsibility of Auditor.........................................................................................................8
Functions of Auditor..............................................................................................................................8
Composition of the Audit Committee....................................................................................................9
Review all Key Audit Matters noted and the associated audit procedures.............................................9
Conclusion...........................................................................................................................................10
References...........................................................................................................................................12

Audit, Assurance and Compliance 3
Introduction
This report brings out the information and analysis that how auditor plays an
important role while maintaining trust and confidence in the company named suncorp group
limited among its stakeholders. This report has detailed discussion of most related topics that
coonects to role of auditor, how they work, non-audit services, discussion of remuneration,
and functions. Auditor’s Independence Declaration marks the freedom of auditors at the
workplace. Audit services are the not only services provided by auditors. An auditor skilfully
performs Non-Audit services and get a reasonable amount of payment from the company.
Introduction of the company
Suncorp group limited is the publically listed company whose share capital is limited
by shares. Suncorp group limited is one of Australia’s medium size banks and the group
umbrellas some of Australia and New Zealand’s general, life insurance; banking. We provide
customers solutions to their financial issues and concern and help those taking steps to
ameliorate their financial stabilities. We have been serving people across New Zealand and
Australia since 1902 (Suncorp, 2018b). Along with the vast community we serve, we are
constantly being working on the environment being provided to the employees so as they can
take advantage of our vast portfolio of brands and which could help excel them in their fields
and so that they can better understand their responsibilities. The goal is to be a reliable group
and provide a solution, which not only helps the people but also our shareholders and
stakeholders. We are operating with the brand names of Suncorp, AAMI, Bingle, Apia,
Shannon in Australia (Suncorp, 2018a).
Auditor’s Independence Declaration
The Act leads the provisions of Auditor`s independent declaration under the section
307C of the corporation Act, 2001. The auditors have accepted that there was no

Audit, Assurance and Compliance 4
contraventions in the auditor`s independence requirements that are set out in Corporation Act
in context to audit. Auditors have admitted that there are no such contraventions in any
professional conduct of applicable code to audit. Moreover, while conducting the audit of
Suncorp group limited, the auditors complied with all the independent requirements of
corporation Act 2001 (CPA Australia Ltd, 2018a). The independence policy also has the
details of the procedure they follow. The procedure includes recruiting, reviewing, appointing
the members of the internal audit committee (Stafford, Deitz, & Li, 2018). A per the
independent policy, auditors are prohibited to avail the services of independence that do not
hamper and threaten the independence through compliance role and several conflicts.
Australian auditing standards stated the role of auditor in evaluating and reviewing the
company’s financial reports. It reveals the right of independence of auditors. Auditors
evaluate and maintain the professional attitudes when providing both audit services and non-
audit services to the company (Leuz, & Wysocki, 2016).
Independent auditor’s report
As per the opinion of auditors of the company, it has accompanied financial report of
the company with Corporation Act 2001 that includes true view of company`s financial
position for the fiscal year. The auditor has ensured that the company complied with AACR
(Australian Accounting Standards and Corporations Regulations) in 2001 (Wang, Li, & Li,
2015). The opinion of auditors were based on the Australian Auditing Standards (Louwers,
Ramsay, Sinason, Strawser, & Thibodeau, 2015). The stakeholder believes that audit
evidence should be obtained in sufficient and appropriate manner. The auditor reports that
they have their independent Group according to Corporation Act, 2001. A separate ethical
requirement of Accounting Professional and Ethical Standards Board’s APES 110 Code of
Ethics for Professional Accountants is related to the audit of financial report of Australia
(Ball, Grubnic, & Birchall, 2014). The auditors are able to fulfil their ethical responsibilities

Audit, Assurance and Compliance 5
as per the code of conduct. The independent Auditor`s report is enables the transparency of
Suncorp Group Limited to the shareholders. As per shareholder`s interest, the financial report
should consists of fair consolidated statement of income, statement of change in equity and
fair view of estimated cash flows statement for the year ended (Amaliah, laafar, & Atan,
2015).
Non-Audit services performed by the Auditor
In the fiscal year, auditor of the company named as KPMG performed services audit
services, as well as non-audit services and keep reviewing the financial report. The director
board of the company has realised that all non-audit services delegated between the fiscal
year have received proper confirmation from the Audit committee. The board strives to make
sure that auditors do not compromise the compatibility and compromise the provisions and
obligations to perform non-audit services (Raudla, Taro, Agu, & Douglas, 2016). The
auditor`s independence report requirements of Corporations Act for some reasons such as-
All the non-audit services are subject to be accompanied as per the corporate
governance procedures of the company. Then, Audit committee ensures that the committee
do not affect the integrity and objective of reviewing the financial reporting (Kim, Shi, &
Zhou, 2014). The non-audit services that are provided by the auditors do not undermine or
damage the general principles which relates to auditor independence described in APES 110
(Code of Ethics for professional Accountants) because the code of conduct do not involve
reviewing and auditing their own work (Chan, and Vasarhelyi, 2018). An auditor has the
capacity of managing decision-making for the company. As an advocate, an auditor plays an
important role for jointly sharing risks and rewards of the company (CPA Australia Ltd,
2018a). There are many non-audit services provided by the auditors such as Tax compliance,
wealth maximisation strategy, advice for expansion and non-audit services includes
remuneration of around $285000 in 2017 and $39000 in 2016 (Suncorp, 2018a).

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Director responsibility differs from Director to Auditors in regards to financial reports
Director and management is responsible for preparing the financial report that reflects
a fair view according to Australian Accounting Standards and Corporation Act 2001 with
300A section. Director is responsible for implementing the necessary internal auditor control
team that assist in preparation of financial reports (CPA Australia Ltd, 2018a). The director is
responsible for assessing the ability of the Suncorp group limited to continue the company as
a going concern. Various accounting principles are disclosed only when the company is a
going concern (Suncorp, 2018a).
Auditor`s responsibility and objectives for the audit-
The objective is to obtain reasonable assurance of whether the financial statements are
free from material misstatements. It is the responsibility of the Auditor to establish an
analysis report of the company. They should ensure that considered material in individual
method could reasonably influence the economic basis of financial report (CPA Australia
Ltd, 2018a).
Auditors’ remuneration
The remuneration report follow sec 300A of the corporation Act, 2001. Mostly, the
non-executive members of the company gets the professional fee at the base level. It is found
that the experiences of these auditors is relatively excelled in various areas such as finance
market, audit services, tax compliances, and experienced in various industries (Pelger, 2016).
The whole committee gets a sum of money fees to distribute it to all the members of the
committee. Undoubtedly, the fees and remuneration is paid highest to the chairperson and
attracts the maximum fess of the committee according to his knowledge and experience in the
concerned industry (Suncorp, 2018b). Moreover, the company also pays the auditors for their

Audit, Assurance and Compliance 7
non-audit services provided to the company. Both audit and non-audit executive members
follow the board’s advice of remuneration committee (Suncorp group limited, 2015).
Auditors 2017 2018 Difference % change
Dr Z
Switkowski AO
659000 659000 0 No change
W Bartlett 340000 335000 65000 19.11%
A Exel AO 275000 275000 0 No change
S Herman 180000 275000 95000 52.77%
E Kulk 406000 412000 6000 1.47%
C McLoughlin 309000 330000 21000 6.79%
Dr D
McTaggart
319000 336000 17000 5.32%
S Machell 319000 52000 267000 83%
To determine and calculate the change in remuneration paid of the non-executive
members and auditors from year 2012 to 2018, 2017 is taken as a base to see the estimated
change in payment of remuneration (Suncorp, 2018b). As a result of change evaluated, it is
found that the combination of superannuation and cash fees of S machell has seen the highest
change from year 2017 to 2018. The company was able to reduce the cost of remuneration
fees. Moreover, the fess of Dr Z Switkowski AO and A Exel AO has not changed. The
estimated fees of E Kulk, C McLoughlin, and Dr D McTaggart has not noticed much change
in payment of fees from 2017 to 2018 (Suncorp group limited, 2017).

Audit, Assurance and Compliance 8
Role and responsibility of Auditor
The auditor is a representative that reveals that fair accounts are revealed to the
stakeholders. Auditor identifies and mitigates the risk association with the misstatements that
financial report may have whether due to fraud.
Auditor obtains an understanding of internal control audit system so that they can
design some relevant audit procedures, which can work in a particular environment. The aim
of appointing an auditor is to win the confidence among the shareholders (Dooren,
Bouckaert, & Halligan, 2015). Moreover, it also provides a sense of confidence among the
directors ad management of the company.
An auditor checks that how far the accounting principles and disclosures of
accounting estimates have been applied to the financial statements.
The auditor communicates and concludes the appropriateness of the owners’ decision
and the working of the management. Use of going concern concepts of accounting is based
on the evidences provided by the auditor. An auditor evaluates the overall presentation of
financial reporting that includes disclosures that will judge the financial reports presenting the
underlying transactions and programmes in such a manner that targets fair presentation.
Functions of Auditor
The main function of Auditors is to establish an Audit and risk management
committee by the board. Auditors assist the directors to fulfil and reflect the true and fair
financial reports to safe the interest of the shareholders, customer, employees, and
shareholders. Apart from these functions, it protects the community by fraud and
untruthfulness that can occur on the part of company by identifying effective assessment,
monitoring, and risk of management (Buckless, Krawczyk, and Showalter, 2014). The
auditors make sure that information delegated to the company for its stakeholders in regards

Audit, Assurance and Compliance 9
to financial reporting complying them with ASX guidelines issued to protect the interest of
the shareholders. Shareholders also gets the right to raise questions if they do not understand
the terms in the Annual report of the company (suncorp group limited, 2017).
Composition of the Audit Committee
The management hierarchy of the organisation has both executive and non-executive
members. The non-executive members of the organisation if from the nomination committee.
The remuneration committee operates under the charter of its own and reports to the board of
directors. The chairperson of the audit committee is Douglas F McTaggart, who is an
expertise knowledge and experience in the field of business as well as governance. HEis also
the director of the company and a member of remuneration committee (Suncorp, 2018a). The
other four members addressed as William Bartlett, Ewoud Kulk, Dr Douglas McTaggart, and
an Ex officio member named asDr Zygmunt Switkowski AO. The members of the
remuneration committee have experience as independent non-executive director of the
company and include the chairperson of Audit committee and chairperson of Risk committee.
Dr Z E Switkowski AO, M A Cameron, W J Bartlett, S Herman, G T Ricketts CNZM
(Suncorp group limited, 2017).Ms Herman is the director the company since 2015. She is the
member of Audit and risk committee and has an experience in the field of retail,
manufacturing, financial services, and property sectors.
Review all Key Audit Matters noted and the associated audit procedures
Auditors reviewed and brought out some key audit matters. Estimation the amount of
outstanding liabilities and assets that includes reinsurance assets, it is a key audit matter. It
involves high degree of uncertainty that is estimated as the future payment for the assets and
liabilities for outstanding claim is incurred (Suncorp group limited, 2015).

Audit, Assurance and Compliance 10
Critical analysis of estimating the payment arises when claims are incurred in the reporting
date but not have reported to group because it take many years to finalise and calculate the
cost of the claim and final cost may be effected by the factors unknown after the preparation
of financial reports. Auditors requires deep understanding of the challenging estimation
process of industry (Suncorp group limited, 2017).
The company involved actuarial specialists to perform audit procedures. The matter of
challenging estimation process found that appropriateness of group`s actuarial methods and
assumptions for CTP. The auditors challenged the actuarial method. Moreover, it challenges
the accuracy of previous estimations (Auditing and Assurance Standards Board, 2013).
Impairment provisions is another important key audit matter that consider the
significance of both short-term and long-term loans. Some specific impairment provisions are
based on Group`s analysis and estimation (Guimaraes, Grzeszczuk, Bisset III, & Donnelly,
2018). There exist high level of complexity applied by the group in finding out provisions
and judgement requirements while using and challenges these estimations. The Audit process
associated with loans and advances test key control system over customer loan rating, credit
risk model, and credit risk reviews. Auditors perform credit assessments for a sample of
business loans that requires loan strategy papers and provisions estimation are prepared by
credit risk officers (Auditing and Assurance Standards Board, 2013).
Conclusion
In context to financial report of Suncorp group limited, it is required to conclude that
there exist a material misstatement of other information that are found prior to date of when
Auditor’s report was realised. After the preparation of Auditor’s report, there is nothing to
report. Moreover from the above report, it came to my knowledge that there are any more
services provided by the auditor except the statutory compliance. An auditor provides the

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services that are partially audit services. The independent report of auditors is evaluated that
how far they work in a free environment. A financial report once approved by the auditors
have more confidence than a financial report prepared by the management (Ismail, Kiennert,
Leneutre, & Chen, 2016).