SOLUTIONS MANUAL to accompany MODERN AUDITING & ASSURANCE SERVICES

The Chartered Accounting profession of South Africa is one of the most esteemed professions in the world, due to the enhancement and maintenance thereof by the South African accounting institutions (South African Institute of Chartered Accountants, 2011). This essay will discuss the Chartered Accounting profession in South Africa by referring to the professionalisation of accountancy in South Africa and the professional status of Chartered Accountancy in terms of the definition of a profession. This essay will furthermore explore the mechanisms that are inaugurated at present by the South African accounting institutions to maintain the professionalism of Chartered Accountancy.

The effective use of IA departments causes less dependency and or reliance on external auditing. Ineffective use of this department can create reliability of the external audit firm, high costs for use of their services. Ideally, effective auditing should be done twice a year, consist of a short period of attendance; whereas, if it is possible for charities to have an internal auditing department, auditing will be carried out as often as every three months and the likelihood of any mismanagement of funds will be greatly reduced and this lead to gradual abolition. For effective IFC practices, various functions should be implemented to address each area so that effective operations are in place and at the same time reduce

The purpose of accounting is to record the financial information, such as transactions and performance, related to a business. The accounting profession has been in existence for as long as business transactions have occurred. It wasn’t until 1494, however, when Luca Pacioli, a Venetian merchant, wrote Summa de Arithmetica, Geometrio, Proportioni et Proportionalita. His writings described a two-entry system of debits and credits, which became the basis for modern accounting systems. Three centuries later, with the emergence of the Industrial Revolution and the development of corporations, the profession of being an accountant became a necessity to keep track of the rising costs and cash flows. As a result, the American Association of Public

In a financial audit, the Auditor General is looking directly at the transactions and financial statements of the entity in search that the financial statements have been presented fairly with full disclosure and that they have met legislative authorities. With more than ninety-five audits performed on different government departments, Crown corporations and governments of the Yukon, Nunavut and Northwest territories, these financial statements are a great source in deciding whether or not these entities have been spending public funds appropriately. The Auditor General will come to a decision about whether or not the transactions have followed laws and will bring to the attention of Parliament anything believed to be of importance.

.01 As professionals, certified public accountants perform an essential role in society. Consistent with that role, members of the American Institute of Certified Public Accountants have responsibilities to all those who use their professional services. Members also have a continuing responsibility to cooperate with each other to improve the art of accounting, maintain the public 's confidence, and carry out the profession 's special responsibilities for self-governance. The collective efforts of all members are required to maintain and enhance the traditions of the profession.

The act is an exhaustive piece of legislation that contains eleven major section and some of the most important titles outline requirements on auditor independence, analyst conflict of interests, corporate responsibility, enhanced financial disclosures, internal controls assessment, and corporate fraud accountability (Bainbridge, 2007). One of the main benefits of the legislation is to establish auditor independence requirements and rules for the prevention of conflicts of interest in particular by prohibiting auditing firms from offering other services. Prior to Sarbanes–Oxley, the auditing professionals were self-regulated and the decisions that controlled the industry, such as violation of ethical standards, were made largely by auditors themselves (Verschoor, 2012). In order to prevent conflict of interests, the Sarbanes–Oxley Act grants the PCAOB authority to oversee and regulate auditing firms, conduct investigations, and impose disciplinary sanctions against accounting firms (McDonough, 2004). Another provision of the Act is requiring senior executives to be personally accountable and responsible for the financial information reports by certifying that the information is correct.(Welch, 2006). A byproduct of the law implementation is a significant quality improvement on accounting practices;

Accountants should always carry out the public responsibility, meaning they have a responsibility to ensure that the accounting functions are performed to the highest possible standards and the information which an organisation provides for its stakeholders is true and accurate. To reach the goal of improving the performance of accountants, there might be several steps to undertake. There should be on-going education to keep abreast with the existing and emerging

The act endorses companies to change the practice and regulations of accounting and auditing. It required them to maintain good financial recorded which were different than the past. The management team is held personally liable for the reliability and accuracy of the financial statements. All publically listed companies must establish a system of internal controls which must be evaluated by management at least quarterly and external auditors are required to conduct independent assessments of company’s in –house internal controls as well as report any fault or fraudulent acts they observe.

As the investors and general public have had the chance to witness the response by public accounting, the audit profession has began its climb into becoming a prestigious profession again. Public accountants are once again perceived as the protector of the investors and general public by performing audits to gain reasonable assurance that the financial statements are fairly stated.

There are numerous threats to the independence of auditors which have been identified in the multiple studies and discussions both in Australia (such as the Ramsay report, CLERP 9 Paper) and internationally by IFAC, the European Commission

Accounting has become a more interesting and attractive position among the millennials due to the high demand in the industry after the Enron fraud scheme in the early 2000’s. It has also become a more interesting field due to the how the profession’s involvement and characteristics have changed since the incident as well. Accountants used to be known to be bean counters, characterised to be introverts, simply keeping track of companies’ financials. In recent years, there has been a shift from profession in which accountants

Ruth Hines’ paper discussing how we construct reality is very interesting and leads one to wonder whether accountants have too much power. Accounting classes teach concepts of realization and organizations as if it has always been that way. It is hard to think of why accountants do things the way they do, because it is just the way it is supposed to be done. Accountants are considered to be the professionals that everyday stakeholders trust to provide reliable information. As Hines said, “Everything would be a mess without us.” Naturally, everyone assumes accountants always know how to handle an issue; it is safe to say most people assume they do not have issues in the first place. But, of course, there are always issues that need to be handled.

Auditors having the appropriate competence and capabilities to perform the audit, and follow ethical requirements, and maintain professional skepticism throughout the audit.

What draws me into the field of accountancy? Why do I want to launch a career as a certified public accountant (CPA)? What is there about numbers, spreadsheets, profit and loss statements, audits, inventory and fiduciary responsibility that appeal me? In this paper I will describe in detail the reasons why I am attracted to this field. Also, what are the duties and responsibilities of a CPA? How available are job openings for a person with the education and experience to work as a CPA? How well to companies compensate those hired as CPAs? These questions and issues will be thoroughly reviewed in this paper.

Accounting is the language of business. It is a profession that is being guided by principles, concepts, conventions, laws, etc. All these fundamental building blocks serve as common and general compasses to all practitioners of the profession. In some cases, they are nation-wide tailored, while in other cases, they are universally tailored. Accounting as a living, practical, dynamic and realistic profession covers so many areas of social, economic (business), and governmental activities. Surely, any endeavour that involves monetary and material activities create a room for the services of Accounting. Many of the human endeavours for which the accounting profession plays significant (some times inevitable) roles include; Banking, Insurance, Manufacturing, Farming Contracting, Oil and Gas, Mining, Transportation (Air, Land and Sea), Educational Institutions, Churches, Ministries, ICT, Hire Purchase, Local Government Authorities, Estate Businesses, Export and Import Businesses, Bill of Exchange Transactions, Royalties Transactions, Consignment Transactions, Stock Market Transactions, Sports, Entertainment, Hospitals and Hospitality Industry, etc.