Auditing Profession Act 2005

Transcription

1 Auditing Profession Act 2005 Introduction Lecture 1 Professional bodies in SA SAICA IRBA Comply with education, training and competency Lecture 1

2 Auditing Profession Act 2005 Introduction Lecture 1 Introduction Background Audit Objects Structure Lecture 1

3 Auditing Profession Act 2005 Audit: Definition Lecture 2 Audit Examination of financial statements or financial information with the objective of expressing an opinion on the fairness or compliance with a financial reporting framework in accordance with applicable auditing standards. (Section 1 APA, definition: Audit) Lecture 2

4 Auditing Profession Act 2005 Objectives Lecture 2 Objectives - Protect the public by regulating audits - Establish Independent Regulatory Board for Auditors (IRBA) - Provide for accreditation of professional bodies - Provide for registration of auditors - Regulate conduct of registered auditors - Improve development and maintenance of internationally comparable ethical and auditing standards for auditors - Set measures to advance the implementation of standards of competence and good ethics in the profession - Provide for disciplinary action for improper conduct Lecture 2

5 Auditing Profession Act 2005 Structures Lecture 3 Structure Chapter 1 Interpretation and objects of the Act Chapter 2 IRBA (functions, powers) Chapter 3 Accreditation & registration (individual: education, training, competency and professional development requirements, firm: all registered individuals with IRBA shareholders and directors, joint & several liable (personal liability company)) Chapter 4 Conduct by & liability of registered auditors Chapter 5 Accountability of registered auditors (IRBA power review practice auditor, disciplinary actions) Chapter 6 Offences Chapter 7 General matters (admin matters) Lecture 3

6 Conduct by and liability of Registered Auditors Duties in respect of an Audit APA Section 44 Lecture 4 44 Duties in relation to an audit Not express unqualified opinion on financial statements UNLESS Free from restriction (all required info obtained) Compliance with auditing standards & laws Existence of assets & liabilities Proper accounting records No section 45 RI in progress Financial statements are fair Lecture 4

7 Conduct by and liability of Registered Auditors Reportable Irregularities Definition Lecture 5 Definition: Reportable irregularity Unlawful act or omission committed by Person responsible for management Which is any of the following:! Caused / likely to cause material financial loss! Fraudulent / amounts to theft! Material breach of fiduciary duty Lecture 5

8 Conduct by and liability of Registered Auditors Reportable Irregularities APA Section 45 Lecture Duty to report irregularities Without delay Send a written report to IRBA (report 1) Notify management in 3 days THEN - Within 30 days of report 1 Send a new report to IRBA (report 2) No RI occurred No longer any RI occurring RI is still occurring Lecture 6

9 Conduct by and liability of Registered Auditors Reportable Irregularities APA Section 45 Audit report Lecture 7 Other matters relating to RI Impact on the audit report Affects fair presentation of AFS Qualify Audit Report Does not affect fair presentation of AFS Modify the report, (eg: emphasis of matter) Not reporting an RI Disciplinary action Civil claim, pay damages to affected parties, criminal charges Lecture 7

10 Conduct by and liability of Registered Auditors Limitation of Liabilities APA Section 46 Lecture 8 46 Limitation of liability No liability in respect of opinion expressed To client or third party UNLESS Malicious Fraudulent Negligent (only if knew / reasonably expected to know about client / third party reliance thereof) Lecture 8