上海金融學(xué)院會計財務(wù)管理系

上海金融學(xué)院會計財務(wù)管理系2025/2/22InternationalAuditingIssuesChapterTwelve2025/2/22InternationalAuditingIssues

IntroductionAuditorsasbothindividualsandfirmsaregoingincreasinglyinternationalduetoincreasedglobalizationofbusiness;Financialadvisorsmustbeasmultinationalastheirclients;Toaccomplishthisprofessionalaccountantshaveformedglobalorganizations,12025/2/22Introduction(Cont.)Externalauditorsprovideclientswithglobalvalueaddedservices,including:Taxadvice,Training,FinancingControlsReview,BasicAccountingServices.22025/2/22TheAccountingandAuditingProfessionAuditingasdefinedby:Quantifiableandverifiablefinancialdataofeconomicentities;Establishedcriteria;Acompetentandindependentpersontotestthecorrespondencebetweenthedataandthecriteria.Thisdefinitionmustbeconsideredinlightofdifferingdomestic/internationalaccounting/auditingstandards.32025/2/22TheAccountingand

AuditingProfession(Cont.)4Auditorqualityrelatestoanation’s:Viewoftheaccountingprofession,Anation’seducationalsystem,andMethodofcertificationofauditorsandaccountant.2025/2/22GlobalAuditServicesandtheInternationalAuditingChallengeServicesprovidedbyglobalauditfirms:Auditservices;Taxadvisoryservices;Consulting/Managementservices.Theglobalenvironmentpresentsuniquechallengesforauditors:Localbusinesspractices/customs;Differencesincurrency,language,andlaw;Distanceandorganizationalissues;Availabilityofsuitablepersonnel.52025/2/22LocalBusinessPracticesandCustomsCancreatechallengesinconfirmingwhathasoccurred:Paymentbycashratherthancheckiscommoninmanycountriesmakingrecord-keepingdifficult;Confirmingaccountsreceivableisdifficultduetolanguagedifferences,lackofcustomerexperiences,mailproblems,andprivacyissues.62025/2/22Currency,LanguageandLawManycountrieshavecurrencyrestrictionsandtransferrequirements;Translationandtransactionalissuesmustbeunderstood;Ignoranceofthelocallanguagecanbeafatalhandicap;Knowledgeofhowhomecountrylawsinteractwithlocallawsisessential.72025/2/22DistanceandOrganizationforProvidingAuditServicesOrganizingaglobalauditingfirmtoperformservicesisverydifficult;Distanceisamajorconcernformultinationalenterprisesandcanlimitthescopeofauditservices;Solutionstothedistanceprobleminclude:Traveltoforeignclients,Physicalorlegalpresenceabroad.82025/2/22AvailabilityofSuitablePersonnel9Findingqualifiedpersonneltostaffforeignofficescanbedifficult;Thenumberofaccountantsavailabledependsonthebarrierstoenteringtheprofession,suchastestingandeducational/certificationrequirements;Globaltrainingandcertificationofaccountantscanvaryconsiderably,threemodelsexist:Apprenticeship,University,andDualTrack.2025/2/22Numerousnationalrestrictionspreventthemovementofaccountingprofessionalsbetweencountries;TheGeneralAgreementonTradeinServices(GATS)addressesreciprocityissues:Signatoriesagreetoadministerlicensingrulesinareasonable,objectiveandimpartialmanner,Countriesareencouragedtorecognizeothercountries’qualifications,TheUS,Canada,andAustraliahaveagreedtosimplifiedstandardsforreciprocity.10AvailabilityofSuitablePersonnel(Cont.)2025/2/22Strategies:Accountingfirms“goglobal”tobetterservicetheirclientsandtoprotecttheirmarkets.Thefivelargestglobalpublicaccountingfirmsare:ArthurAnderson,Deloitte-Touche,ErnstandYoung,KPMG,andPrice-WaterhouseCoopers.11GlobalAccountingFirms2025/2/22Strategies(cont.):Sincethe1980’s,manyglobalaccountingfirmshavegrownthroughmergers;Globalfirmshavealsobeganorganizingaroundindustry.12GlobalAccountingFirms(Cont.)2025/2/22Multinationalfirmsareincreasinglyrelyingonglobalaccountingfirmstoassisttheminattractinginternationalinvestors;Investorswantanobjectiveassessmentoffirmfinancialstatements.Auditstandardsdifferfromcountrytocountry;Auditstandardscomefromthepublicsector,privatesector,andacombinationofthetwo:Developedcountriesoftenrelyontheirprivatesectorstopromulgatestandards.13AuditStandards2025/2/22TheEUFourthandEighthDirectives:FourthDirectiverequiresauditsforallcompanieswithinitspurview,EighthDirectivedealswithauditstandardsandqualifications.14AuditStandards(Cont.)2025/2/22TheInternationalFederationofAccountants(IFAC)isattemptingtoharmonizeauditstandardsandauditprofessions;IFACissuesguidanceinsixkeyareas:Auditing,Education,Ethics,FinancialManagementAccounting,InformationTechnology,andPublicSectorAccounting.15InternationalHarmonizationof

AuditStandards2025/2/22Wouldgiveusersinothercountriesconfidenceinauditreports,Providingreaderswithassurancethatauditstandardsarebeingfollowed;Helpreadersmakeinternationalfinancialcomparisons;Provideincentivestoimproveandextendinternationalaccountingstandards;Aidtheflowofinvestmentcapital;Helplesser-developedcountriesdevelopdomesticauditstandards;Helplessentheeffectofdistancebetweenmanagementandusers.16BenefitsofDevelopingand