Case A - Report
Value: 10%
Due Date: 19-Aug-2018
Return Date: 07-Sep-2018
Length: 1600 words
Submission method options: Alternative submission method
Task
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Background:
You a member of the audit team at Miller Yates Howarth (MYH), an accounting firm with offices throughout the major regional centres of NSW and Queensland. Although a medium sized firm by national standards, MYH is the second largest regional accounting firm in Australia. Most of MYH’s audit clients are in the agriculture, mining, manufacturing and property industries. All those industries are currently under pressure, either from a downturn in commodity prices or fierce competition from overseas competitors. MYH have now been appointed auditors of a community bank. Two audit directors have previous experience auditing in the banking sector and need to raise the awareness of staff with respect to the governance issues that have recently impacted the banking sector.
Question 1 (7%)
Required:
You have been asked to:
• read audit standard ASA315 focusing on audit responsibility with respect to client governance,
• read the web page on the APRA report on the Commonwealth bank which details the governance issues raised by APRA (http://www.apra.gov.au/MediaReleases/Pages/18_17.aspx), and
• prepare a report that:
o summarises and justifies the auditor’s responsibility to review the governance of an audit client, and
o Includes a table for use in the audit which explains the impact of each of the ASIC identified Commonwealth Bank governance issues on audit risk. The table should further explain why each of the ASIC recommendations would reduce audit risk. The template below should be used.
Issue Impact on raising audit risk Recommendation Reduction in audit risk because of the recommendation

Question 2 (3%)
Required:
Explain the role that incorporation of auditors and a statutory cap on auditors’ liability have on the limitation of auditors’ liability.
Rationale
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This assessment task will work towards assessing the following learning outcome/s:
• be able to explain and critically evaluate influences on audit and assurance services including: Australian and international professional standards, statutory and common laws, regulatory bodies, and public expectations within a global market.
• be able to exercise critical and reflective judgement and appreciate the value of ethical practice.
Marking criteria and standards
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Criteria High Distinction Distinction Credit Pass
Explanation and critical evaluation of the influence of Australian and international professional standards, public expectations and regulatory bodies on audit and assurance services. (7 marks) Provides a comprehensive synthesis and critical evaluation of the APRA findings and their impact on audit risk. Provides an advanced synthesis and critical evaluation of the APRA findings and their impact on audit risk. Provides a competent synthesis and critical evaluation of the APRA findings and their impact on audit risk. Provides a simple listing of the APRA recommendations with some recognition of the impact on audit risk.
Use of critical and reflective judgment in ethical practice in the application of the ethical decision guide (3 marks). Complex and detailed application of the ethical decision guide demonstrating strong critical and reflective thinking the use of the guide. Logical application of the ethical decision guide demonstrating coherent critical and reflective thinking in the use of the guide. Substantial application of the ethical decision guide demonstrating critical or reflective thinking in the use of the guide. . Ethical decision guide applied demonstrating basic thinking in the use of the guide.
Critical explanation of the influence of public expectations and regulatory bodies on audit and assurance services (3 marks) Provides a comprehensive synthesis and critical evaluation of the role that incorporation and statutory cap on auditors liability have on the limitation of auditors liability. Provides an advanced synthesis and critical evaluation of the role that incorporation and statutory cap on auditors liability have on the limitation of auditors liability. Provides a competent synthesis and critical evaluation of the role that incorporation and statutory cap on auditors liability have on the limitation of auditors liability. Provides a basic critical evaluation of the role that incorporation and statutory cap on auditors liability have on the limitation of auditors liability.
These last two criteria relate to the whole of the case study.
Professional communication including the use of a report structure for Question 1.
(Note: you are required to space between paragraphs; use Arial 10pt or TNR 12 pt; use 1.5 or double line spacing)
(1 mark). Question 1 is in a report format and contains distinct understandable statements with no errors. There is a sophisticated use of language.
Extremely well organised.
Content is structured in a manner that facilitates the reader’s understanding. Question 1 is in a report format and contains distinct understandable statements with minimal errors.
Answer is well organised.
Content is structured in a manner that facilitates the reader’s understanding. Question 1 is in a report format. There are minor spelling, grammar and punctuation errors. Work shows evidence of proofreading.
Well-structured with one main idea or argument provided per paragraph. Some spelling, grammar and punctuation errors found but the work is readable and structured. Some attempt at a business report format.
Work may include
too many ideas in one
paragraph.
Appropriate resources and correct referencing.
(1 mark) Used three or more sources.
All work has been referenced correctly as per APA (6th edn) requirements. Used two or more sources.
All work has been referenced correctly as per APA (6th edn) requirements. Used one or more sources.
All work has been referenced within the body of the answer and in the reference list, with some omissions or errors in terms. No additional sources other than the text used. Others’ work is not always acknowledged and there are several errors or items of non-compliance with the APA (6th edn).