Call / WhatsApp: UK: +44 7308 518706 | USA: +1 8126514131
Generic selectors
Exact matches only
Search in title
Search in content
Post Type Selectors

Assignment Studio

  • Services
    • Academic Writing Service
      • Assignment Help
      • Academic Assignment Help
      • Assignment Writers
      • Custom Writing Services
      • Online Assignment Help
      • Effective Note-taking – Assignment Help
      • Assignment Help Australia
      • Write My Assignment
      • Help on Assignments
      • Buy Assignment Online
      • Best Assignment Helper
      • Assignment Paper Help
      • College Assignment Help
      • Help with Assignments Online
      • Get Assignment Help
      • Homework Assignment Help
      • Thesis Writing Services
      • Online Assignment Writer
      • Collect material
    • Assignment By Cities
      • Perth Assignment Help
      • Brisbane Assignment Help
      • Adelaide Assignment Help
      • Gold Coast Assignment Help
      • Geelong Assignment Help
      • Newcastle Assignment Help
      • Sydney Assignment Help
      • Melbourne Assignment Help
      • Hobart Assignment Help
    • Assignments by Universities
      • Swinburne Assignment Help
      • Monash Assignment Help
      • Latrobe University Assignment Help
      • Monash Assignments
      • Coles Assignment Help
      • Melbourne University Assignment
      • CQU Assignment Help
      • NMIT Assignments
      • RMIT Assignments
    • Essays
      • Essay Writing Guide
        • How to Write an Essay
        • Creating an Essay Structure
        • Essay Marking Schemes
        • How To Write An Essay Plan
        • Interpreting Your Essay
        • Writing An Essay Title
        • Writing A Critical Evaluation
      • Essay Help
        • Argumentative Essay
        • Critical Essay
        • Essay Writing Help on Comparison Essay
        • College Essay
        • Deductive Essay
        • Essay Writer
        • Admission Essay
        • Online Essay Help
        • Do My Essay Online
        • Evaluative Essay
        • History Essay Help
        • Research Essay Help
        • Urgent Essay Help
        • Top Quality Essay
        • Top Essay Writing Companies
        • Cheap Essay Writing Help
        • Professional Essay Help
        • Cheap Essay Writer
        • Essay Writers Online
        • Need Help Writing Essay
        • Essay Homework Help
        • Write Essay Online
      • Types of Essay
        • Argumentative Essay
        • Admission Essay
        • College Essay
        • Comparison Essay
        • Definition Essay
        • Deductive Essay
        • Evaluative Essay
        • Narrative Essay
        • Personal Essay
      • Essay Writing Tips
        • College Essay Help
        • Essay Writing Help
      • Essay Help Cities
        • Assignment Writer Sydney
        • Assignment Writer Brisbane
        • Assignment Writer Melbourne
        • Assignment Writer Perth
        • Essay Writer Sydney
        • Essay Writer Melbourne
        • Essay Writer Perth
        • Essay Writer Australia
        • Essay Assignment Help
    • Other Services
      • Dissertation Writing Assignment Help
      • Cheap Assignment Help
      • Creating An Appendix
      • Assignment Help Tutors
      • Assignment Assistance Australia
      • Student Assignment Help
      • Last Minute Assignment Help
      • Urgent Assignment Help
      • Assignment Provider
      • Do My Assignment Help
      • Make My Assignment For Me
      • Solve My Assignment
      • Custom Assignment Writing
      • How to Write a Dissertation – Assignment Help
      • Quality Assignment Help
      • Write My Assignment For Me
      • Assignment Writing Tips
      • Buy Assignment
    • Article Writing Service
    • Assignment Help UK
    • Animation Assignment Help
    • Coursework Help
    • College Assignment Help
    • Leadership Assignment Help
    • Network Planning Assignment Help
    • Dissertation Proposal Writing Help
    • Report Writing Help
    • My Assignment Help
    • Microsoft PowerPoint Presentation
    • Pecha Kucha Presentation Help
    • Pestel Analysis Assignment Help
    • University Assignment Help
    • Video Presentation Assignment Help
  • Homework Help
  • Subjects
    • Accounting
      • Auditing Assignment Help
      • Business Accounting Assignments
      • Management Accounting Assignment Help
      • Professional Accounting Assignment Help
    • Economics
      • Economics Globalization Assignments
      • Micro Economics Assignments
      • Macro Economics Assignments
      • Business Economics Assignments
      • Managerial Economics Assignments
    • Finance
      • Principle Of Finance Assignments
      • Financial Management Assignment Help
      • Financial Accounting Assignments
      • Introduction Corporate Finance Assignments
    • Business
      • Entrepreneurship Assignment Help
      • Leadership Assignment Help
      • Business Assignment Help
      • Project Management Assignment
      • Supply Chain Management
      • Business Management Assignment Help
      • Human Resource Assignment Help
      • Operation Management Assignment
      • Leadership Assignment
      • Change Management Assignment Help
    • Law
      • Contract Law
      • Constitutional Law
      • Corporate Law
      • Common Law
      • Criminal Law
      • Commercial Law
      • International Law
      • Property Law Assignment
      • Taxation Law Assignment
      • Tort Law Assignment
    • Engineering
      • Engineering Assignment Help UK
      • Civil Engineering
      • Computer Engineering
      • Mechanical Engineering
      • Software Engineering
      • Online Engineering Assignment Help
      • CDR Writing
      • CDR Assignment Help
    • Marketing Assignment Help
      • Marketing Assignment Help
      • Social Media Marketing Help
      • Digital Marketing Assignment
      • 4ps Of Marketing Assignment Help
      • Pestel Analysis Assignment
    • Assignment Help On Companies
      • woolworths Assignment Help
      • Costco Assignment Help
      • Coles Assignment Help
    • Popular Assignments
      • Pricing Strategy Assignment
      • Sales Promotion Assignment
      • Porters Five Forces assignment
      • Solve Accounting Assignment
      • Bitcoin Assignment Help
      • Lehman Brothers and Enron Scandal Auditing Assignment
      • IT Management Assignment Help
      • Healthcare Management Help
      • Decision Making Assignment
    • Project Management Assignment Help
    • Artificial Intelligence Assignment Help
  • Sample Assignments
  • Resources
    • Assignment details
    • Give us a Feedback
    • Make a Payment
    • Plagiarism Checker
    • Privacy policy
    • Refer a Friend
    • Submit Documents & Earn
    • Terms of service
    • Word Counter
  • Blogs
  • Get a Quote
SignupLogin
 June 8, 2025

Get online Expert's Answer Help on

BBAC601 | Auditing and Assurance

BBAC601 | Auditing and Assurance Assignment Help

Introduction

The profession of auditing is a very honorable one as it requires expressing a professional opinion on the accounting records and financial statements of the business entity which is relied upon by the shareholders of the company. Audited financial statements as such inform the users of those financial statements that the information reflected in these statements represent the true and fair view of the business affairs of the company. The overall purpose of the audit is to enhance the degree of confidence reposed by the intended users in the financial statements of the entity. Without conducting an audit, the shareholders and other users wouldn’t know whether the management of the company including its directors are taking all necessary steps to conduct the business and whether the financial statements are prepared in all material respects in accordance with the entity’s applicable financial reporting framework (IAASB, 2010). The level of confidence can only be enhanced by appointing a third party auditor who is totally independent of the management of the business entity. However, there are certain controversies and issues that have been observed in the current business environment and which repose significant threat to the profession of auditing and true and fair financial reporting. This essay briefly sheds light on the purpose of appointing an independent auditor and discusses in detail the recent controversies relating to the rotation of independent auditors, and the threats to the auditor’s ethical obligations to remain objective in all aspects of his profession.

Unlock success in auditing studies with Assignmentstudio! Our dedicated team offers comprehensive Auditing Assignment Help tailored to your needs. From financial audits to compliance checks, trust us for accurate solutions and academic excellence!

 

Why Independence is Essential?

Audit is concerned with the public interest and the overall corporate governance environment in the entity. Therefore it is of utmost importance for the auditor to remain objective, act with integrity and to remain skeptical through the audit. These objectives cannot be achieved if the auditor is dependent on the entity in one way or the other, e.g., if the auditor is an employee of the business entity then the management could easily influence his opinion on the financial statement by either threatening the job or increasing the incentive schemes. Therefore all the corporate environments and economies in the world require the external auditors to be independent of the audit client. According to the International Standards on Auditing published by the International Federation of Accountants, independence enables the auditor to form opinion on the financial statements without being affected by the potential influences (internal or external) that may compromise that opinion (IAASB, 2010). These standards are the most recognized and most followed framework of auditing standards throughout the world. Auditors in most of the economies are also required to follow the Code of Ethics for Professional Accountants as promulgated by IESBA. That code lays a primary obligation on all external auditors to accept only those audits where auditor is completely independent of the entity.

Therefore, independence is considered to be the most fundamental attribute of audit throughout the world and without it the underlying objective of conducting and audit would never be achieved. Firms providing audit attestation and assurance services also engage in non-audit services and engagements. In this regard, there has been a debate in the business world regarding whether the audit firms should engage in non-assurance services due to the possibility of their independence in audit engagements being impaired (Antle, 1984). Securities and Exchange Commissions of various countries and the regulating authorities have often tried to assess the auditor’s independence by comparing the fees derived from providing non-assurance services with the fees derived from audit engagements. This simple measure can provide a good idea about the auditor’s dependence on the client.

Despite such emphasis on independence in the auditing and accounting literature about the independence of the external auditor, the actual definition of what constitutes auditor’s independence is somewhat vague or is quite lengthy to give a reasonably clear conclusion. Independence of the auditors has therefore always been the most controversial and debated area in the profession of auditing.

Controversies Relating to Auditor’s Independence

In the past few decades the overall focus of corporate governance and regulation is to enhance the shareholder value and to promote transparency in the corporate world. Although shareholders are the ultimate consumers of the auditor’s work and they are the persons who pay auditor for his work, little has been heard about their opinion about the auditors and what independence means to them. Shareholders and other users of the financial statements make their decisions based on the audited information presented in the financial statements. Likewise the auditor’s report is also addressed to the shareholders of the company. Therefore, any shortcomings are likely to directly affect the quality of the decisions made by the users.

The recent scandals, cases of frauds and the inability of auditors to warn of problems beforehand have directed the attention of the United States’ and European regulators towards the integrity of auditors and the means to promote transparency and enhance the quality of audits. There have been numerous financial scandals around the world. What began with the Enron scandal (Hilzenrath, 2001) was extended to the WorldCom (Pulliam & Blumenstein, 2002) and has also led to the downfall of the Andersen’s audit firm (McRoberts, 2002). Many audit firms including Deloitte have been knowingly or unknowingly found to have committed fraud at one time or another (Hamilton, 2013).

 

Stuck with your Assignment?

Hire Qualified Writers for Assignment Help at Low Price

WhatsApp Get a Quote

 

The controversy over auditor’s independence also existed before these scandals were unveiled when it was observed that the auditors have been charging more fees for providing non-assurance services engagement than that for providing assurance services. This trend has been seen in many countries in the world including New Zealand (Cheung & Hay, 2004). The previous studies and research on the topic of auditor’s independence has shown that these issues raiding the question of independence are interpreted and perceived differently by the auditor than other groups. Most of the studies are concentrated on the user groups other than shareholders. The corporate laws in most parts of the world prescribe the method of appointment of external auditors, and prohibit any person from becoming the auditors of the company, whose opinion may be unduly compromised by the management of the company. Therefore any person who has been a director or employee of the company for a prescribed time period, a partner or employee of the director or employee of the company or its related party, close family members of the directors, shareholders and liquidator of a company or nits related party are often prevented from acting as auditors of the company by these laws. The IFAC laws also require the auditor to constantly maintain “independence of mind” and “independence of appearance”. The Code defines independence of mind as, “The state of mind that permits the expression of a conclusion without being affected by influences that compromise professional judgment, thereby allowing an individual to act with integrity and exercise objectivity and professional skepticism.” (IFAC, 2010)Independence of appearance is defined by the code as, “The avoidance of facts and circumstances that are so significant that a reasonable and informed third party would be likely to conclude, weighing all the specific facts and circumstances, that a firm’s, or a member of the audit team’s, integrity, objectivity or professional skepticism has been compromised.” (IFAC, 2010) The IFAC Code also requires the chartered accountants to remain alert to the possible threats to their independence and employ all possible safeguards.

A study conducted by Jeff Cheung and David Hay identified the core issues that shareholders of the company are concerned with when it comes to independence of the auditor. According to the findings of the survey, the self-interest threats are most common among the auditors and shareholders rated the auditor receiving greater non-assurance fee than that from the audit engagement as their major concern and the greatest threat to their independence and objectivity. Self-review threats include the auditor keeping an executive payroll by providing confidential internal audit and financial systems development and transaction advisory services. Familiarity between the directors and auditors, along with the auditor to take a key management position in the client company immediately after conducting the audit were the major concerns for the shareholders as far as familiarity threat is concerned. Advocacy and intimidation threats were found to be rare and fairly harmless to the auditor’s intimidation (Cheung & Hay, 2004).

The IFAC code also requires the independent auditors to constantly review their independence in various terms such as when auditor derives significant proportion of his audit fee from just one client, audit fees that remain unpaid, acceptance of gifts and major rewards etc.

Recent Controversies Relating to Rotation of Independent Auditors

The rotation of independent auditors has been a hot topic for debate for the last decade. Rotation refers to the change in the audit firm by the companies after a specific period of audits or financial years. The debate originates from the fact that when auditors keep auditing the financial statements of the same client for many consecutive periods, they may develop dependence due to the resulting familiarity with the audit client. This is strictly against the principle of independence principle and at the same time very difficult to avoid. There are two schools of thoughts who believe contrary to each other. One group believes that the imposition of mandatory rotation rules would not enhance the quality of audit but only reduce its efficiency, and would result in unnecessary red tape and legal procedures relating to the work of auditors which should be kept highly professional and independent. On the other hand, the other group believes that without mandatory rotation the same auditors would continue to audit the financial statements of the most largest public companies and eventually develop familiarity and independence with their client, which would comprise their objectivity and greatly impair the overall objectives of the auditor as well as the shareholder value.

 

For Complete Assignment Solution

Place your Order Now

 

Need Urgent Academic Assistance?

Price Starts from $10 Per Page

*
*
*
*

Get Instant Help through WhatsApp

Assignment Studio - Your Partner in Academic Success!

For Students in UK

WhatsApp

For Students in USA

WhatsApp

Popular Services

Assignment Help

Homework Help

Essay Help

Dissertation Help

Assignment Help UK

Thesis Help

Research Paper Help

Report Writing Help

CDR Writing

Popular Subjects

Law Assignment Help

Engineering Assignment Help

Marketing Assignment Help

Project Management Assignment Help

Accounting Assignment Help

Business Assignment Help

Economics Assignment Help

Artificial Intelligence Assignment Help

Assignment Help on Companies

Finance Assignment Help

Auditing Assignment Help

Leadership Assignment Help

Video Presentation Assignment Help

Nursing Assignment Help

Statistics Assignment Help

IT Assignment Help

Database Assignment Help

Programming Assignment Help

Social Media Assignment Help

Samples

Sample Assignment Solutions

Essay Writing Samples

Literature Review Samples

Case Study Samples

Marketing Report Samples

Worldwide Services

United Kingdom

United States

Australia

Canada

United Arab Emirates

Singapore

Resources

Word Counter

Submit Documents & Earn

Plagiarism Checker

Refer & Earn

Give us a Feedback

Order a New Assignment

Quick Links

Terms & Conditions

Refund Policy

Privacy Policy

Blog

Refer & Earn upto 4000$

Our Globally Trusted Assignment Help Service Delivers Tailored Solutions with Expert Guidance, Timely Delivery, and Unmatched Quality for Students in the UK, Australia, and USA!

Contact Us

UK Office

101, Gower Street,WC1E 6AA, London, United Kingdom

Mobile

+44 7308 518706

USA Office

Brooklyn 11216, New York, United States

Mobile

+1 8126514131

Australia Office

533 Little Collin Street, Melbourne, Australia

Assignment Studio © 2025 All rights reserved.

TOP
Order Notification

[variable_1] from [variable_2] has just ordered [variable_3] Assignment [amount] minutes ago.

Get 1-On-1 Customized Essay Assistance

Order Now and Get 40% Off

*
*
*
*

Get 1-On-1 Customized Research Proposal Assistance

Order Now and Get 40% Off

*
*
*

Get 1-On-1 Customized Dissertation Assistance

Order Now and Get 40% Off

*
*
*

Get 1-On-1 Customized Thesis Assistance

Order Now and Get 40% Off

*
*
*

Order Now

Order Now and Get 40% off on your Assignment 

*
*
*
*

Order Now and Get 25% off For September-October only

textbox6129
textarea1740
Select FileChangeRemove
fileupload7305

‹›×

    Get Assignment Help from Expert Writers

    From World's No.1 Assignment Help Company

    *
    *
    *
    *
    *
    *
    Hire Professional Writers at Low Prices!
    *
    *
    *
    *