Book contents
- Frontmatter
- Contents
- Contributors
- Table of cases
- Table of statutes
- Preface
- Preface to the first edition
- PART ONE BASIC CONCEPTS, BOARD STRUCTURES AND COMPANY OFFICERS
- PART TWO CORPORATE GOVERNANCE IN AUSTRALIA
- 5 Corporate governance in Australia – background and business initiatives
- 6 Regulation of corporate governance
- 7 The role of the regulators: ASIC and ASX
- 8 Accounting governance
- 9 Auditors and audits
- 10 Directors' duties and liability
- 11 Enforcement of directors' duties
- PART THREE CORPORATE GOVERNANCE IN INTERNATIONAL AND GLOBAL CONTEXTS
- PART FOUR BUSINESS ETHICS AND FUTURE DIRECTION
- Index
9 - Auditors and audits
from PART TWO - CORPORATE GOVERNANCE IN AUSTRALIA
Published online by Cambridge University Press: 05 June 2012
- Frontmatter
- Contents
- Contributors
- Table of cases
- Table of statutes
- Preface
- Preface to the first edition
- PART ONE BASIC CONCEPTS, BOARD STRUCTURES AND COMPANY OFFICERS
- PART TWO CORPORATE GOVERNANCE IN AUSTRALIA
- 5 Corporate governance in Australia – background and business initiatives
- 6 Regulation of corporate governance
- 7 The role of the regulators: ASIC and ASX
- 8 Accounting governance
- 9 Auditors and audits
- 10 Directors' duties and liability
- 11 Enforcement of directors' duties
- PART THREE CORPORATE GOVERNANCE IN INTERNATIONAL AND GLOBAL CONTEXTS
- PART FOUR BUSINESS ETHICS AND FUTURE DIRECTION
- Index
Summary
Audited financial statements are an important part of the financial information that is available to the capital markets and an important part of effective corporate governance.
Ian M Ramsay, Independence of Australian Company Auditors: Review of Current Australian Requirements and Proposals for Reform, Report to the Minister for Financial Services and Regulation, Canberra, Department of Treasury, October 2001 [4.01]Introduction: The audit role and where it fits into corporate governance
Overview of the audit role
Auditing is defined as an assurance service that objectively gathers evidence and communicates it to third parties. Companies that are required to prepare a financial report for a financial year must have their financial report audited and obtain an auditor's report. Thus, all large proprietary companies and public companies must appoint an auditor. Small proprietary companies in normal circumstances are not required to prepare a financial report and hence need not appoint an auditor. However, they must do so in a limited range of circumstances, namely where shareholders holding at least 5 per cent of voting shares require preparation of accounts and ask for an auditor.
Broadly, the function of an auditor is to conduct an audit on the financial affairs of the company and to ascertain whether the financial report provided by the company complies with relevant legal requirements and accounting principles, and gives a true and fair account in all material respects of the company's financial affairs. The audit role has several objectives.
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- Principles of Contemporary Corporate Governance , pp. 219 - 239Publisher: Cambridge University PressPrint publication year: 2010