THE INTERNATIONAL ETHICS STANDARDS BOARD FOR ACCOUNTANTS

This assignment is to be completed in groups of three and comprises twenty per-cent of the marks for this course. There are four questions each worth five marks each (approx. 2000 words in total) 

Assessment Criteria:

Student work will generally be assessed in terms of the following criteria:

1. Effectiveness of communication – i.e. readability, legibility, grammar, spelling, neatness, completeness and presentation will be a minimum threshold requirement for all written work submitted for assessment. Work that is illegible or incomprehensible and does not meet the minimum requirement will be awarded a fail grade.
2. Demonstrated understanding - This will be evidenced by the student`s ability to be dialectical in the discussion of contentious issues.
3. Evidence of research - This will be evidenced by the references made to the statutes, auditing standards, books, journal articles and inclusion of a bibliography.

Note:

1. All written work must conform with the Federation University General Guide for the Presentation of Academic Work.

2. For all written work students must ensure that they submit their own original work. Any act of plagiarism will be severely penalised.
   
   

Plagiarism is presenting someone else work as your own and is a serious offence with serious consequences. As set out in the University Regulation 6.1.1, students who are caught plagiarising will, for a first offence, be given a zero mark for that task. A second offence will result in a failing grade for the course(s) involved and any subsequent offence will be referred to the Student Discipline Committee. Student must be aware of the University Regulation 6.1.1 Student Plagiarism.

Students Must:

• fully reference the source(s) of all material, even if you have re-expressed the ideas, facts or descriptions;
• acknowledge all direct quotations; and
• not submit work that has been researched and written by another person. 
  

Question 1.

The International Ethics Standards Board for Accountants (IESBA) has recently released a consultation paper, ‘Improving the Structure of the Code of Ethics for Professional Accountants’ (the Code)

Briefly describe the Code as it applies to professional accountants.

Question 2.

The application of professional skepticism can be enhanced if it is considered at different structural levels; i.e. 1.Individual auditor, 2. Engagement team, 3. Audit firm, and 4. Overall audit profession.

Discuss each level in terms of 1. Potential threats; 2. Mitigating factors and 3. Suggestions to enhance

Question 3.

The AASB is currently in the process of making changes to AASB101 Presentation of Financial Statements in an attempt to ‘declutter’ financial statements. The main aim of this ‘decluttering’ initiative is to apply materiality to all disclosures. AASB Media Release (2/2/15)

Entities are not required to disclose immaterial information in their financial statements. Just because a standards contains a list of disclosures does not mean that an entity must always make each of those disclosures in its financial statements. Judgement is required to determine whether the relevant line item is material and also whether the specified disclosure is material.

It seems as if the Accounting Standards say one thing (don’t disclose if not material), yet preparers and auditors have done the opposite (disclosure, disclosure and more disclosure).

Explain why is there is disclosure overload by preparers and auditors.

Question 4.

List and explain at least five (5) common pitfalls flagged by professional bodies and file reviewers which auditors should try to avoid.