...Summary The article entitled “Code of Ethics for Internal Auditors Harmonised with the International Standards for Internal Audit” was written by George Calota. The article begins speaking about Code of Ethics – A condition imposed by the International Standards of Internal Audit. Ethics is defined by the article as a set of principles or moral values which people take as reference and which determines them to act in a particular way. According to the article, The Josephson American Ethics Institutes defined some ethical principles such as Credibility, which is the aggregated outcome of honesty, integrity, reliability and loyalty; Respect which represents an accumulation of concepts like politeness, manners, dignity, tolerance and acceptance; Responsibility, Equity & Justice, Empathy, Civic spirit. The Internal auditor’s code of ethics has the purpose to create the ethical framework required to undertake the internal audit profession, so that the internal auditor may accomplish their tasks professionally, loyally, correctly and thoroughly and refrain from any act which might harm the entity where they work. The article also discusses “Principles of Ethics and Professional Behaviour for Internal Auditors Harmonised with the International Standards for Internal Audit.” Under this heading it states that the internal audit activity helps the entity to achieve its objectives through a systematic and disciplined approach, by evaluating and improving the performance of risk management...
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...Topic 1: Ethics (Code of Ethics for Professional Accountants) Topic 1: Ethics (Code of Ethics for Professional Accountants) ------------------------------------------------- ------------------------------------------------- Introduction According to the Institute of Internal Auditors a Code of Ethics is a comprehensive statement of the values and principles, which should guide the daily work of auditors. The Code of Ethics states the principles and expectations governing the behavior of individuals and organizations in the conduct of internal auditing. It describes the minimum requirements for conduct, and behavioral expectations rather than specific activities. Fundamental Principles The Code of Ethics mandates that internal auditors behave and practice with integrity, objectivity, professional competence and due care, confidentiality and professional behaviour. These are the fundamental principles of professional ethics and all members of the professional accounting bodies are to comply with these principles (APES 110, S.100.4). Purpose of the Code of Ethics Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. A code of ethics is necessary and appropriate for the profession of internal auditing, founded as it is on the trust placed in its objective assurance about governance, risk management, and control. The Code of Ethics extends beyond the definition of internal...
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...practice of ethics in professional activities. The purpose of this report is to review Threats to Compliance with the Code of Conduct by Professional Accountants. With the expanding business in the modern world, issues arise on professionalism of Independent and Internal Auditors. Is it whether the Professional Accountants follows the ethical code provided by the International Ethics Standards Board for Accountants in order to provide true and effective financial reports to the internal and external users? Professionals are expected to conduct themselves at a higher level than most others members in the organization. The International Accounting Bodies has emphasized the conceptual...
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...other organisations has created the need for a specialist in various business controls: the internal auditor. We can understand better the nature of internal auditing today if we know something about the changing conditions in the past and the different needs these changes created. What is the earliest form of internal auditing and how did it come into existence? How has internal auditing responded to changing needs? As the operations of an organisation become more voluminous and complex, it is no longer practicable for the owner or top manager to have enough contact with all operations to satisfactorily review the effectiveness of performance. These responsibilities need to be delegated. The Development of the Profession of Internal Auditing Internal auditing has evolved from accounting-oriented to a management-oriented profession. At one time, internal auditing functioned as a junior to the independent accounting profession, and attesting to the accuracy of financial matters was the profession's main concern. Now internal auditing has established itself with a far broader focus. Modern internal auditing provides services that include the examination and appraisal of controls, performance, risk and governance throughout public and private entities. Financial matters represent only one aspect of the purview of internal auditing. Requirement to have Internal Audit Activity In January 2004, the US Securities and Exchange Commission (SEC) had approved...
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...40 SU 1: Strategic and Operational Roles of Internal Audit QUESTIONS 1.1 Change Management 1. An organization's management perceives the need to make significant changes. Which of the following factors is management least likely to be able to change? A. The organization's members. B. The organization's structure. C. The organization's environment. D. The organization's technology. Answer (C) is correct. REQUIRED: The factor management is least likely to be able to change. DISCUSSION: The environment of an organization consists of external forces outside its direct control that may affect its performance. These forces include competitors, suppliers, customers, regulators, climate, culture, pol technological change, and many other factors. The members are a factor that managers are clearly Answe~(A) is incorrect. factor that managers are incorrect. The organiz I are clearly able to change. organization's technology' able to change. 2. Lack of skills, threats to job status or security, and fear of failure all have been identified as reasons that employees often A. Want to change the culture of their organization. B. Are dissatisfied with the structure of their organization. . C. Are unable to perform their jobs. D. Resist organizational change. Lack of skills, threats to job status or re inhibit changes in the culture of the (8) is incorrect. Lack of skills, threats to job status . rity, and fear of failure are not symptoms of dissatistacjion with the structure of the organization...
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...Question 1 Who is permitted to act as the auditor of company under the Companies Act 1965? Under section 9(1) of the Act, a person is prohibited from acting or accepting an appointment as the auditor of a company if he is: Not an approved company auditor => Section 4 ( Definition ) and section 8 - Company auditors and liquidators to be approved by Minister charged with responsibility for finance . Indebted to the company or its related company in an amount exceeding RM 2,500. An officer of the company. A partner, employer or employee of an officer of the company. A partner, employee of an employee of an officer of the company. A shareholder of a corporation whose employee is an officer of the company, or Responsible for or if he is the partner, employer or employee of a person responsible for keeping the members’ register or the register of debenture-holders of the company. a) b) c) d) e) f) g) Question 2 : For professional accountants in public practice, what are the circumstances that are likely to pose a conflict of interest with the client? Conflict of interest often arises in situation when a professional accountant in public practice competes directly with the client or is in business relationship with a major competitor of the client. Conflict of interest is also likely to arise when a professional accountant performs services for clients who are in dispute with each other or whose interests are in conflict. Question 3 : For each of the following situations, discuss...
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...globally recognized. It is counter check to accounting data so that any error, mistake or fraud can be easily detected through the technique of auditing. It is the primary source of advice on efficiency, effectiveness and overall economy of an establishment. Auditing starts its journey where accounting end. In today’s society the exercise of an auditor’s to the economic and ethical leadership sets the bounding standard or in other words equips an auditor in such a way that recognizes him as a reliable body. With the growing conscious recognition of the importance of financial data in the ordering of everyday business and economic life, the need of basic economic facts is providing a constantly enlarging opportunity for the accounting profession. The auditors' reports have an especial capacity to fulfill the need for reliable and authoritative financial material not only because of the reputation or prestige of the certified statements, but also because of the significance generally attached by the business man to the functions of the auditor and his reports. These functions, and the scope of these reports, have in the past been definitely related to the character of and changes in business activity. Audits and reviews are basically procedures performed on the financial statements of a company, for the purpose of determining whether the financial statements include any material misstatements. Misstatements are essentially wrong numbers due to numerical errors, fraud, or errors in...
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...globally recognized. It is counter check to accounting data so that any error, mistake or fraud can be easily detected through the technique of auditing. It is the primary source of advice on efficiency, effectiveness and overall economy of an establishment. Auditing starts its journey where accounting end. In today’s society the exercise of an auditor’s to the economic and ethical leadership sets the bounding standard or in other words equips an auditor in such a way that recognizes him as a reliable body. With the growing conscious recognition of the importance of financial data in the ordering of everyday business and economic life, the need of basic economic facts is providing a constantly enlarging opportunity for the accounting profession. The auditors' reports have an especial capacity to fulfill the need for reliable and authoritative financial material not only because of the reputation or prestige of the certified statements, but also because of the significance generally attached by the business man to the functions of the auditor and his reports. These functions, and the scope of these reports, have in the past been definitely related to the character of and changes in business activity. Audits and reviews are basically procedures performed on the financial statements of a company, for the purpose of determining whether the financial statements include any material misstatements. Misstatements are essentially wrong numbers due to numerical errors, fraud, or errors in...
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...August, 2013 stating that different dates may be appointed for enforcement of different provisions of this Act through notification of the Central Government in this regard. Having regard to the above development, the Council at its 333th meeting, revised the syllabus in a comprehensive manner in the following papers of Intermediate (IPC) and Final Course(s) as annexed herewith (shown in Bold cum Italics): Intermediate (IPC) Course Paper 1: Accounting (Group I) Paper 2: Business Laws, Ethics and Communication (Group I) Paper 5: Advanced Accounting (Group II) Paper 6: Auditing and Assurance (Group II) Final Course Paper 3: Advanced Auditing and Professional Ethics (Group I) Paper 4: Corporate and Allied Laws (Group I) Director, Board of Studies Annexure SYLLABUS PAPER 1: ACCOUNTING (One paper – Three hours – 100 Marks) Level of Knowledge : Working Knowledge Objectives : (a) To lay a foundation for the preparation and presentation of financial statements, (b) To gain working knowledge of the principles and procedures of accounting and their application to different practical situations, (c) To gain the ability to solve simple problems and cases relating to sole proprietorship, partnership and companies and (d) To familiarize students with the fundamentals of computerized system of accounting. Contents : 1. A General Knowledge of the framing of the accounting standards, national and international accounting authorities, adoption of international financial reporting standards Accounting...
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...Most accounting firms offer client services in three areas: auditing, tax, and consulting. A new accountant might be hired to work in any of these areas. In the audit area, the accountant may work for a variety of clients including private or public companies, clients in banking, insurance, manufacturing, technology, retail, health care, or government. Individuals working in the audit area may also spend most of their time providing internal audit services to clients rather than working as an external auditor. Working in any of the areas in an accounting firm may be one of the most demanding jobs, but it is also one of the most interesting, exciting experiences and a great way to prepare to work in the corporate business world.” “What is Auditing?” Web. 29 September 2013 Accounting is the recording, classifying, and summarizing of economic events in a logical manner for the purpose of providing financial information for decision making. To provide relevant information, accountants must have a thorough understanding of the principles, and rules that provide the basis for preparing the accounting information. In addition, accountants must develop a system to make sure that the entity’s economic events are properly recorded on a timely basis and at a...
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...enhance the students’ understanding in auditing. Among the topics that will be discussed are code of ethics, auditors’ liability and in-depth explanations on analytical procedures, computer assisted audit techniques, audit sampling, materiality and audit risk, group audit and current issues facing the auditing profession. This course will justify other activities than financial statement audit that can be performed by a public accountant like performance/operational audit, internal audit and compliance audit. 2. COURSE OBJECTIVES This course intends the student: 1. To comprehend applicable regulations, legal responsibilities and ethical standards and current issues facing the audit profession. 2. To appreciate the concepts of internal control system and the use of computer assisted audit techniques in auditing a computerised environment. 3. To understand and apply audit risk, materiality, and statistical and non statistical audit sampling techniques. 4. To be familiar with related issues in audit completion, group audit, internal audit and related audit services and other services that can be provided by the public accounting firms. 3. LEARNING OUTCOMES Upon completion of the course, students will be able to: 1. Explain the professional conduct and ethics of an auditor, the legal liability environment affecting the auditors and relate it to relevant cases (C2, P2, A3). 2. Relate the significance of client’s IT and its...
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...Chapter 1 Internal audit is an independent, objective assurance and consulting activity designed to add value and improve an organization’s operations. It help an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management control, and government processes. Objective- what an organization wants to achieve. Strategy- how management plans to achieve to organization’s objective. 4 types of objectives -Strategic objectives: value creation choices management makes on behalf of the organization’s stakeholders. -Operations objectives: effectiveness of and efficiency of the organization’s operations. -Reporting objectives: reliability of internal and external reporting of financial and nonfinancial information -Compliance objectives: adherence to applicable laws and regulations Governance is the process conducted by the board of directors to authorize, direct, and oversee management toward the achievement of the organization’s objectives. Risk management is the process conducted by management to understand and deal with uncertainties that could affect the organization’s ability to achieve its objectives. Control is the process conducted by management to mitigate risks to acceptable levels. Independence is the freedom from conditions that threaten objectivity or the appearance of objectivity. Objectivity is an unbiased mental attitude that allows internal auditors to perform...
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... Some of the different professional fields we are going to look at in this paper are Auditor, Finical advisers, Tax accountant, Management Accountant, and Government accountant. As we study accounting and accountant we will look at the different boards that governed the accounting field, the education that is required, the standers, ethics, and the different certifications. The different accounting degree and certifications, a person can get a certificate in accounting in one year. An associate degree in two years, a bachelors in four years, a master’s in six, and doctoral in eight years. For any of these accounting degrees a person has to attend college classes. With a certificate, associate and bachelors a person can get their certification as Certified Public Account (CPA) the CPA test consist of four tests. A master’s degree a person can get there Certified Management Account (CMA), and Certified internal auditor (CIA) with a doctoral in accounting a person can go into researchers or teaching (Different Accounting Degrees, 1999). Auditor, there are internal and external auditors, and internal auditors work as a full-time or part- time employee, their job is to find ways for the company to save money. External auditors are hired to make sure their financial reports are factual, or by an agency, government or investors, to make sure the company is following regulations. If the auditor files...
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...Enron Corporation case study • The Enron debacle created what one public official reported was a "crisis of confidence" on the part of the public in the accounting profession. Lists the parties who you believe are most responsible for the crisis. Briefly justify each of your choices. The debacle of Enron, a US firm is looked upon as the worst debacle and fall out in the history of US bankruptcy filed cases. There are many parties involved when it concern to Enron debacle, which was accorded to accounting instability and the compromising factor of accounting profession itself. Out of the many parties in the league and the major force behind the debacle of Enron concern Andersen's, the accounting and auditing firm that once deserved name in the industry for its conscience in accounting professional services and auditing. As the case relates to, accounting audit for Enron is attended by Andersen's since long enough. However, the interesting feature is that some compromise in the profession of accounting services by Andersen's was notable, given that there are noteworthy feature of stock manipulation, especially in financial statements of Enron attended and audited by Andersen's. The statement and restatement of Enron also gives some probable indication for manipulation of accounting, where debate and counter debate in that regard from the prying eye of the media was a common feature. Thus, the involvement of Andersen's in Enron consultancy and professional auditing makes it...
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...CASE NO. 4 CORPORATE GOVERNANCE: VALUES VERSUS ETHICS 1. Is Manuel Dolorica still liable with the accusations brought out by the whistle blower? No, Manuel Dolorica is no longer liable with the accusations brought out by the whistle blower. The moment the whistle blower came out and made known to the public the corruptions of government officials, Manuel is not working as an auditor for the government anymore. As an auditor, he performed his responsibility of auditing the government funds and reporting his findings with evidences that proved his discoveries which he did not try to conceal. His liability is limited to reporting the result of the audit engagement--embezzlement of government funds. The burden of proof rests in the confines of the whistle blower’s knowledge of the matters concerning the accusations. 2. If the accusations will pursue to judicial proceedings, should Manuel stand as a witness in the said proceedings? Morally, Manuel Dolorica should stand as a witness if the accusations will pursue to judicial proceedings. Being the son of Sgt. Arturo Dolorica who was a man of principle, he was taught to not deceive his fellow men, always stand for the truth and always abide by the principle that is for the common good. 3. Was resigning from the Ministry of Audit the right way or decision he had to make? If not, what is supposed to be the action he had done during that time? No, resigning from the Ministry of Audit was not the right thing to do. He should...
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