how can the profession and regulators ensure that audit failures do not occur?
Good morning everyone our topic is how can the profession and regulators ensure that audit failures do not occur? Here are our contents. First we give a brief introduction and we talk about some professions’ and regulators’ measures, and also some safeguards, finally we have a conclusion, if u have any questions, we are welcome to answer your questions at the end in the Q&A section.
As we know, audit is playing a very important role in the current society. For example, lots of investors’ economic decisions will be influenced by audit reports. So the quality of audit is necessary to be maintained in order to provide a true and fair view to financial statements users.
However, we’ve heard so many cases which auditors failed to exercise with their independent and resulted in facing a claim, some more severe cases has resulted in curtailment of their activities, suspended by companies, and even close down due to consequential loss of reputation.
Let’s take the famous Enron case as an example. Arthur Andersen, which used to be one of five largest auditor firms in the world, failed to perform a proper auditing work under the threat of its client, which lead to the impairment of independence and caused a serious audit failure.
It’s been found that the impairment of independence is one of main causes of audit failure. So both professions and regulators established rules and safeguards, trying to maintain auditors’ independence. And it will be presented by my teammates.
To conclude, we have mentioned two quality control standards to minimize the prospect of audit failure. International standard on Quality control and International standard on auditing. Then we have talked two major regulated body authorized to monitor the quality of auditors. Audit Quality Review Team and Recognized Supervisory Body. Finally we point out some safeguards established to ensure auditor’s independence. The Requirement of Disclosure and establishing measures designed to ensure auditors’
As we know, audit is playing a very important role in the current society. For example, lots of investors’ economic decisions will be influenced by audit reports. So the quality of audit is necessary to be maintained in order to provide a true and fair view to financial statements users.
However, we’ve heard so many cases which auditors failed to exercise with their independent and resulted in facing a claim, some more severe cases has resulted in curtailment of their activities, suspended by companies, and even close down due to consequential loss of reputation.
Let’s take the famous Enron case as an example. Arthur Andersen, which used to be one of five largest auditor firms in the world, failed to perform a proper auditing work under the threat of its client, which lead to the impairment of independence and caused a serious audit failure.
It’s been found that the impairment of independence is one of main causes of audit failure. So both professions and regulators established rules and safeguards, trying to maintain auditors’ independence. And it will be presented by my teammates.
To conclude, we have mentioned two quality control standards to minimize the prospect of audit failure. International standard on Quality control and International standard on auditing. Then we have talked two major regulated body authorized to monitor the quality of auditors. Audit Quality Review Team and Recognized Supervisory Body. Finally we point out some safeguards established to ensure auditor’s independence. The Requirement of Disclosure and establishing measures designed to ensure auditors’