Question

Imagine you are the audit partner of a major accounting firm, addressing the final year business students of a top university to recruit top graduates as graduate auditors.

Required

In your presentation,

1. Explain the (i) purpose (why) and (ii) nature (what it is) of external financial audits;

(Total 4 marks; 2 marks @)

2. Explain the (i) purpose and (ii) nature of the regulatory legislative framework (select a particular section of an act to illustrate your answer);

(Total 5 marks; 2 and 3 marks)

3. Explain the (i) purpose and (ii) nature of the auditing standards (select a particular auditing standard to illustrate your answer);

(Total 6 marks; 3 marks@)

4. Explain the (i) purpose and (ii) nature of the professional code of conduct for the accounting (auditing include profession (select a particular rule to illustrate your answer);

(Total 5 marks; 2 and 3 marks)

5. Explain the social concepts of (i) common good and (ii) stewardship, respectively.

(Total 4 marks; 2 marks@)

6. Explain how your firm interprets its social responsibilities, with a vision and mission statement, and illustrate the auditing firm’s achievements in these aspects with two specific (presumably hypothetical) examples.

(Total 6 marks; 3 marks@)

Answer 1

1. Purpose and Nature of External Financial Audits:

a. The purpose of external financial audit is to verify that the annual financial statements provide a True and Fair View of the entities financial position and is in accordance with the applicable financial framework.

.b. The major role of audit is not detect frauds. However the frauds may be detected by auditors on application of audit procedures during the course of Audit. Hence auditors are termed as Watch Dogs.

Only part 1 has been answered.