ACCA审计（AA)

F8笔记--03.Professional ethics and quality controls procedures 包含职业道德基础准则、承接审计业务、业务约定书条款、质量控制。

03.Professional ethics and quality control procedures

• Fundamental principles of professional ethics
  • Fundamental principles-ICPOP
  • Confidentiality
    • with customers' consents
    • without permission
      • obligatory disclosure
        • money laundary,terrorsim or drug trafficking
        • process of law,court order or summons
      • voluntary disclosure
        • public interest
        • protect a member'interest
        • authorised by statute/laws
        • non-governmental bodies
  • Objectivity--independence
    • independence of mind
    • independence in appearance
  • Five ethic threats to objectivity
    • self-interest
      • direct financial interest in a client
    • familiarity threat
    • self-review threat
    • advocacy threat
    • intimidation threat
  • Conflict of interest
    • definition
      • between members' and clients' interests
      • between the interests of different clients
    • safeguards include
      • separate engagement teams
      • prevent access to information
      • clear guidelines for members
      • confidentiality agreements signed by employees and partners
      • regular review of the application of safeguards
      • advising one or more clients to seek additional independent advice
• Quality control on an individual audit
  • Objective of the firm
    • professional standards, legal and regulatory requirements
    • reports are appropriate
  • ISQC
  • Engagement quality control review
    • an objective evaluation
    • listed entities
    • peer review
    • hot review
    • cold review
  • Monitoring
    • an ongoing consideration
    • responsibility for monitoring process
    • performing the engagement
• Agreeing the term of the engagement
  • Preconditions for an audit
    • The use by management of an acceptable financial reporting framework in the preparation of financial statements
    • Obtain management's agreement (written representation)
      • preparing the financial statements
      • establishing internal control to ensure the financial statements are free of material misstatement
      • provide the auditor with access to all records and documents and staff
  • The engagement letter
    • must include
      • The objective and scope of the audit
      • The auditor's responsibilities
      • Management's responsibilities
      • Identification of the applicable financial reporting framework for the preparation of the financial statements
      • Expected form and content of any reports to be issued
    • may include
      • The form of any other communication of results of the audit engagement
      • The fact that some material misstatements may not be detected
      • Arrangements regarding the planning and performance of the audit,including the composition of the audit team
      • The expectation that management will provide written representations
      • The basis on which fees are computed and any billing arrangement
    • features
      • a written letter of the terms
      • common understanding
• Accepting audit appointments
  • Before accepting nomination the auditor must
  • An appiontment decision chart is shown below
  • After accepting nomination
    • outgoing auditor's removal/resignation properly conducted
    • new appointment properly conducted
    • Agree the terms of the engagement