Public Perception – NBC Institute

AAA – May 2018 – L3 – SB – Q2 – Auditor’s Legal Liability

Discuss the expectation gap, strategies to address it, and the role of professional skepticism in auditing financial statements.

Question

Audit firms have been castigated over the years by the public whenever their clients have any financial or operational crises. The potential liability of auditors has also become an important topic in recent years due to the growing complexity of the business and legal environment and an increase in legal actions against auditors. One reason put forward to explain the high number of legal actions against auditors is the “expectation gap.”

Required:

a) Explain “expectation gap” and describe its THREE main elements. (5 Marks)

b) Discuss the strategies that could assist in closing the expectation gap. (10 Marks)

c) i. Explain briefly the concept of professional skepticism. (2 Marks)
ii. Evaluate the importance of professional skepticism in the audit of financial statements. (3 Marks)

(Total 20 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Audit quality, Auditor Liability, Expectation Gap, Legal Environment, Professional Skepticism, Public Perception, Strategies to Close Gap
Level: Level 3

Topic: Auditor’s Legal Liability
Series: MAY 2018

AAA – May 2021 – L3 – Q1a – Rules of professional conduct | Professional responsibility and liability

Discuss the impact of independence issues on the public perception of a multinational accounting firm based on a real-life scenario involving a conflict of interest.

Question

Fundamental principles require that a member of a professional accountancy body behave with integrity in all professional, business, and financial relationships and strive for objectivity in all professional and business judgments. Objectivity can only be assured if the member is and is seen to be independent. Conflicts of interest have an essential bearing on independence and the public’s perception of the accounting profession’s integrity, objectivity, and independence.

The following scenario is a press report on a multinational firm of accountants:

The regulatory body directed a partner in a firm that he must resign because he was in breach of the regulatory body’s independence rules. His brother-in-law was the Financial Controller of an audit client. He was informed that the alternative was for him to move his home and place of work at least 400 miles from the client’s office, even though he was not the reporting partner. This made his job untenable. The accounting firm saw the regulatory body as ‘taking its rules to absurd lengths’. Shortly after this comment, the multinational firm announced proposals to split the firm into the following areas: audit, tax and business advisory services; management consultancy; and investment advisory services.

Required:

In relation to integrity, objectivity and independence, discuss the impact the above events may have on the public perception of the multinational firm of accountants. (10 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Independence, Integrity, Multinational Firm, Objectivity, Public Perception
Level: Level 3

Topic: Professional responsibility and liability, Rules of professional conduct
Series: MAY 2021

BMIS – May 2021 – L1 – Q1a – The business organisation and its stakeholders

Explain five challenges that come with operating as a not-for-profit organization.

Question

Emani World is a not-for-profit and non-partisan organization established in Ghana to offer various services, including corruption prevention campaigns, social justice, election observation, and environmental protection. Like any other not-for-profit organization, Emani World is confronted with numerous challenges in its operations as a not-for-profit organization.

Required:
Explain FIVE (5) challenges that come with operating as a not-for-profit organization.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Expertise Attraction, Funding, Not-for-profit, Political Tagging, Public Perception
Level: Level 1

Topic: The Business Organisation and its Stakeholders
Series: MAY 2021

AAA – May 2018 – L3 – SB – Q2 – Auditor’s Legal Liability

Discuss the expectation gap, strategies to address it, and the role of professional skepticism in auditing financial statements.

Question

Required:

a) Explain “expectation gap” and describe its THREE main elements. (5 Marks)

b) Discuss the strategies that could assist in closing the expectation gap. (10 Marks)

c) i. Explain briefly the concept of professional skepticism. (2 Marks)
ii. Evaluate the importance of professional skepticism in the audit of financial statements. (3 Marks)

(Total 20 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Audit quality, Auditor Liability, Expectation Gap, Legal Environment, Professional Skepticism, Public Perception, Strategies to Close Gap
Level: Level 3

Topic: Auditor’s Legal Liability
Series: MAY 2018

AAA – May 2021 – L3 – Q1a – Rules of professional conduct | Professional responsibility and liability

Discuss the impact of independence issues on the public perception of a multinational accounting firm based on a real-life scenario involving a conflict of interest.

Question

The following scenario is a press report on a multinational firm of accountants:

Required:

In relation to integrity, objectivity and independence, discuss the impact the above events may have on the public perception of the multinational firm of accountants. (10 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Independence, Integrity, Multinational Firm, Objectivity, Public Perception
Level: Level 3

Topic: Professional responsibility and liability, Rules of professional conduct
Series: MAY 2021

BMIS – May 2021 – L1 – Q1a – The business organisation and its stakeholders

Explain five challenges that come with operating as a not-for-profit organization.

Question

Required:
Explain FIVE (5) challenges that come with operating as a not-for-profit organization.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Expertise Attraction, Funding, Not-for-profit, Political Tagging, Public Perception
Level: Level 1

Topic: The Business Organisation and its Stakeholders
Series: MAY 2021

Question Tag: Public Perception

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AAA – May 2018 – L3 – SB – Q2 – Auditor’s Legal Liability

Discuss the expectation gap, strategies to address it, and the role of professional skepticism in auditing financial statements.

AAA – May 2021 – L3 – Q1a – Rules of professional conduct | Professional responsibility and liability

Discuss the impact of independence issues on the public perception of a multinational accounting firm based on a real-life scenario involving a conflict of interest.

BMIS – May 2021 – L1 – Q1a – The business organisation and its stakeholders

Explain five challenges that come with operating as a not-for-profit organization.

AAA – May 2018 – L3 – SB – Q2 – Auditor’s Legal Liability

Discuss the expectation gap, strategies to address it, and the role of professional skepticism in auditing financial statements.

AAA – May 2021 – L3 – Q1a – Rules of professional conduct | Professional responsibility and liability

Discuss the impact of independence issues on the public perception of a multinational accounting firm based on a real-life scenario involving a conflict of interest.

BMIS – May 2021 – L1 – Q1a – The business organisation and its stakeholders

Explain five challenges that come with operating as a not-for-profit organization.

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AAA – May 2018 – L3 – SB – Q2 – Auditor’s Legal Liability

Discuss the expectation gap, strategies to address it, and the role of professional skepticism in auditing financial statements.

You're reporting an error for "AAA – May 2018 – L3 – SB – Q2 – Auditor’s Legal Liability"

AAA – May 2021 – L3 – Q1a – Rules of professional conduct | Professional responsibility and liability

Discuss the impact of independence issues on the public perception of a multinational accounting firm based on a real-life scenario involving a conflict of interest.

You're reporting an error for "AAA – May 2021 – L3 – Q1a – Rules of professional conduct | Professional responsibility and liability"

BMIS – May 2021 – L1 – Q1a – The business organisation and its stakeholders

Explain five challenges that come with operating as a not-for-profit organization.

You're reporting an error for "BMIS – May 2021 – L1 – Q1a – The business organisation and its stakeholders"

AAA – May 2018 – L3 – SB – Q2 – Auditor’s Legal Liability

Discuss the expectation gap, strategies to address it, and the role of professional skepticism in auditing financial statements.

You're reporting an error for "AAA – May 2018 – L3 – SB – Q2 – Auditor’s Legal Liability"

AAA – May 2021 – L3 – Q1a – Rules of professional conduct | Professional responsibility and liability

Discuss the impact of independence issues on the public perception of a multinational accounting firm based on a real-life scenario involving a conflict of interest.

You're reporting an error for "AAA – May 2021 – L3 – Q1a – Rules of professional conduct | Professional responsibility and liability"

BMIS – May 2021 – L1 – Q1a – The business organisation and its stakeholders

Explain five challenges that come with operating as a not-for-profit organization.

You're reporting an error for "BMIS – May 2021 – L1 – Q1a – The business organisation and its stakeholders"

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