Essay on The Future Directions of the Auditing Profession
THE FUTURE DIRECTIONS OF THE AUDIT PROFESSION
Word Count: 1995
This report discusses the historical and current practices required by audit professionals. This is broken down into three main subject areas, being:-
1 The Monitoring of the Profession’s Quality Issue;
2 The Skills and Auditor Needs To Posses; and,
3 The Structure of an Audit and Non Audit Service Engagement.
It is found from a comprehensive review of various literature available and previous studies that have been conducted on the topic that there have been extensive efforts to maintain an acceptable level of quality and monitoring within the audit profession with new and amended processes being put in place. However the …show more content…
[I]n July 2001, when the defendants learned their fiscal 2000 American Tissue audit had been selected for a peer review by another accounting firm, the intentionally altered audit work papers in an attempt to conceal the failures of their audit work. In September 2001, when the defendants learned that another accounting firm had discovered that the company had overvalued inventory and would have to restate financial results for fiscal 2000, they destroyed documents and e-mails in a further attempt to conceal their audit failures (SEC [2005b]).
It can be seen from this situation, that there may be some weight to the argument that partners working on an audit within a single firm are far more likely to question their actions when they are being reviewed by a competitor as opposed to a review by a partner within their own firm thus making the consideration of audit-firm rotation an important one for the Auditor General to conduct research into in the coming future.
3 The Skills and Auditor Needs to Posses
Accountants and especially auditors play an extremely important role in the financial stakes of a company or organisation. For that reason, every piece of work they perform for organisations must be to a high standard. To do this they must have a high level of skill and expertise as well as sticking to strict guideline’s which enables their work to remain at that high standard.