Module 12 Flashcards
What does the FRC issue?
- ethical standards
- practice notes
- bulletins
- international standards on quality control
- international standards on review engagements
- standards for investment reporting
- standards for providing assurance on client assets to the FCA
What is the standard setting process?
Development, Consultation, Governance and voting, publication
What is the development stage of the standards setting process?
topic is identified, any relevant research required.
What is the consultation stage of the standards setting process?
FRC consults formally and informally on what new or amended content would be appropriate. Exposure draft published.
What is the governance and voting stage of the standards setting process?
any proposal to issue, amend or withdraw will be voted on. 2?3 majority required.
What is the publication stage of the standards setting process?
issued or amended pronouncement will be published
Who can the FRC act investigate and act against?
- auditors
- accountants who are member of a RSB
What is the audit enforcement procedure?
- case examiner
- decision to investigate
- investigation -FRC can compel cooperation
- allegations - document served
- enforcement action - decision to pursue
- determination - breaches can be accepted/admitted or it goes to a tribunal
- sanctions
settlement is encouraged- reduced fines for early admission
Is it always the FRC who investigates?
No, the RSB may investigate if they are better placed to do so. CA 2006 states RSBs should have procedures.
What is the International Standards Board?
issue International Financial Reporting Standards (IFRS)
Aim to harmonise financial reporting around the world
What are the barriers to the global adoption of IFRS?
- difference between US and international standards
- concern that IFRS are too onerous fro small businesses
What are the IFRS standard setting procedures designed to ensure?
- transparency and accessibility
- extensive consultation and responsiveness
- accountability
What is the process for production of IFRS?
- publish discussion paper -not mandatory
- publish exposure draft -mandatory
- publish IFRS
What are the current leader for global auditing standards?
issued by International Auditing and Assurance Standards Board (IAASB)
Who does the IAASB belong to?
the international federation of accountants
