ACCT601: Auditing and Assurance Services Semester 1, 2018
Assessment 1: Individual Assignment
Assessment weight : 30%
Due : 15 April 2018 by 23.59
Word limit: : 2000 ± 10%words (maximum)
The group assignment aims to:
1. Give students an understanding of real life auditing issues
2. Help students understand the link between theory and practice; and
3. Foster students’ research, team-working, critical analysis and written communication skills.
You are required to write a business report concerning HIH Insurance by addressing the questions below.
The Case: The Heath International Holdings (HIH) was founded in 1968 and became public in 1998. By 2001, HIH became the second largest insurance company in Australia employing more than 2500 people and had offices across Australia, the United Kingdom and the United States of America, Hong Kong and New Zealand. HIH is considered as the largest company collapse in Australia. Prior to its collapse Even in the year of its demise, HIH was generally considered a conservative and financially healthy business with assets exceeding $8.1 billion. When HIH went into liquidation in March 2001 it left behind debts more than $5 billion.
1. Critically examine the audit report of HIH for the year ended 2000 and provide an evaluation of the audit report with respect to its aims and the extent to which the audit report achieved its aims. (Annual report is accessible from: http://www.aspecthuntley.com.au/asxdata/20001116/pdf/00205722.pdf)
2. Identify where the HIH management and auditors failed to perform their ethical, professional and legal obligations, and discuss motivations that motivated their actions. Remember to include in your analysis accounting irregularities, fraud and misstatements perpetrated and auditing and professional standards breached.
3. Provide an evaluation of the social responsibility performance of HIH.
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Your report should include an introduction, conclusion, appropriate headings, and diagrams or graphs where appropriate. The report should contain an introduction followed by answers to questions and a conclusion. Grading will be based on critical analysis of the issue, evidence of wide reading on topic, coherence in the development of arguments, use of appropriate evidence, and clarity of expressions. You are expected to cite at least five (5) acceptable sources. If you are not clear what constitutes an acceptable source, please consult the Lecturer-In-Charge.
Grading criteria for Assessment #1
Critically examine the audit report of HIH for the year ended 2000 and provide an evaluation of the audit report with respect to its aims and the extent to which the audit report achieved its aims 8
Identify where the HIH management and auditors failed to perform their 12
(ii) professional; and
Remember to include in your analysis accounting irregularities, fraud and misstatements perpetrated and auditing and professional standards breached.
Provide an evaluation of the social responsibility performance of HIH. 6
Format and presentation (referencing, tidiness, grammar, spelling, spacing, paragraphing, page formatting, etc.) 2
Assignments will be graded by 30 April 2018, and grades will be posted in Turnitin. Submission guidelines
The assignment should be submitted via Turnitin no later than 15 April 2018. Submission deadline is strictly enforced. Assignments must be submitted with an ACU cover sheet and should:
Use an assignment cover sheet signed by all students.
be stapled, and elaborate binding and plastic covers are not required.
Be typed using one-and-a half (1.5) spacing left justified.
Use Ariel or Times New Roman font size 12.
Display a one inch margin on all sides.
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Appropriately cite original work, author(s) etc. Citation and referencing must conform to APA (American Psychological Association) format both in the body of the paper and its attached reference section.
Students should retain electronic copies of all work submitted for assessment except in the case of tests and examinations.
Late submission of assignments
Due dates will be strictly adhered to. However, in the case of exceptional
circumstances, students may apply for extensions in the following manner.
In accordance with the ACU Assessment Procedures (para 3):
You may seek extension of submission date for an assessment task prior to the due date by submitting the Application for Extension of time for an Assignment (EX) form. https://www.acu.edu.au/ data/assets/pdf file/0011/126668/EX - ApplicationforExtofTimeforSubmissionofAssessment.pdf
You may seek up to five working days after the relevant due date by submitting the Special Consideration form. https://www.acu.edu.au/data/assets/pdffile/0010/48493/SCApplicationforSpe cial Consideration 20170615.pdf
Assessment tasks submitted after the due or extended date will incur, for each whole or part of a calendar day that the work is overdue, a 5% penalty of the maximum marks available for that assessment task up to a maximum of 15%. Assessment tasks received more than three calendar days after the due or extended date will not be allocated a mark.
Links for further reading about HIH
HIH Insurance Group Collapse (Parliament of Australia)
https://www.aph.gov.au/AboutParliament/ParliamentaryDepartments/Parliamentar y Library/Publications Archive/archive/hihinsurance
The rise and fall of HIH Insurance Group
The HIH collapse: a catalyst for costly reform
Case studies on the HIH Insurance Group
The HIH Report and Clerp 9
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Adams, M. A. (2005). Australian corporate governance: lessons from HIH Insurance. -One Law for All?-: 60th Annual ALTA Conference, The University of Waikato, Hamilton, New Zealand 5-8 July 2005.
Buchanan, B. (2003). Beware of the ides of March: The demise of HIH insurance, Finance Faculty Publications, University of Georgia.
Leung, P. & Cooper, B.J. (2005). The Mad Hatter’s corporate tea party, Managing Auditing Journal, 18 (6/7), 505-516.
Mirshekary, S., Yaftian, A, M & Cross, D. (2005). Australian corporate collapse: The case of HIH Insurance. Journal of Financial Services Marketing, 9 (3). pp. 249-258
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