Modern auditing & assurance services

On 1 May 2006, the Auditing and Assurance Standards Board (AUASB) introduced a series of new legally enforceable Australian Auditing Standards (ASAs), effective 1 July 2006.

Corporate collapses over the last five years, and subsequent criticisms of the audit role, have necessitated a review of the existing auditing standards to ensure audit quality, return stakeholder confidence in the reputation of the audit process, and reinstate to the profession the core audit qualities of reliability, transparency, trust and integrity.

'Modern Auditing and Assurance Services 3rd Edition' reflects the latest developments in the profession, detailing the audit procedures under the 35 legally enforceable ASAs.

Further, this edition has been thoroughly revised to present a current coverage of the auditing environment: the increased focus on professional ethics and ethical competence, governance and professional independence, changes in legal liability for the audit profession, local and international regulatory developments, whilst continuing to provide a thorough analysis of contemporary audit practice as well as significant consideration of assurance services beyond the traditional audit.

Monitor objectivity with important clients: evidence from auditor opinions around the world

We examine whether monitors are likely to compromise their monitoring objectivity in the face of economically important clients in international business settings. In the context of external auditing and assurance services, we measure monitor objectivity by whether auditors are more (or less) likely to issue to their important clients modified audit opinions, that is, audit opinions provided to outside investors about the firm that demotes explicit areas of concern. Using a large cross-country sample, we document that auditors are more likely to issue modified opinions to their economically important clients relative to other clients. Furthermore, we find that this association is stronger (1) for Big N auditors, (2) for multinational audit clients, and (3) in countries with stronger legal regimes. These results suggest that monitors prioritize the protection of their reputation over lucrative economic relationships, and such information certification function is more pronounced for international auditors, multinational client firms, and in strong legal regimes.

Acceptability, impact and sustainability of the national pilot quality assurance system for self management programs

Chronic condition self-management education and training interventions such as the Stanford Self Management Programs (SMP) have the capacity to improve health and quality of life of people with chronic conditions whilst reducing the use of health services. This is in line with the outcomes from the recent Council of Australian Governments’ meeting where it was indicated that self-management will be a centrepiece in forthcoming chronic disease initiatives.
Aim: report on a large national pilot quality assurance program involving the implementation and of an evaluation and quality monitoring system for SMPs including the provision of structured feedback to courses course leaders and service providers. During 2005/06 the quality assurance program was implemented at 11 diverse organisations across Australia. The program involved assisting organisations apply the 42-item Health Education Impact Questionnaire (HEIQ), a chronic disease health education outcome measure, and then observe and evaluate the value and impact of the quality program. Interviews with course leaders (n=60) and course participants (n=35) have elicited views about course quality and feedback processes.
Results: The evaluation revealed enablers and barriers to effective implementation and sustainability. Important enablers were:
- Course Leaders and organisations valued an Australia-wide system that provided feedback on course
quality and the impact on participants.
- Course Leaders were strongly personally motivated to respond appropriately to HEI-Q course
report feedback.
- Completing the questionnaire provided participants with the opportunity to reflect on issues that
emerge in the course content and reflect on their progression at the end of the SSMP.
Sustainability issues included:
- Organisations and course leaders require support, training and flexibility on how to administer and
manage the use of the HEI-Q.
- Availability of administrative resources in organisations to support the quality assurance activities.
- The requirement that course leaders are trained in interpreting HEI-Q course report data.
A quality improvement framework was developed which identified the actions required of key stakeholders to
support effective implementation.
Discussion: With the increasing endorsement of SMP across sectors it is important that course quality is known, is acceptable, and is communicated to stakeholders to inform and engender confidence in the SSMP. To effectively implement and sustain a quality improvement program for SMP, the processes and tools for measuring outcomes need to be responsive, flexible and easily integrated into the organisation and delivery of programs.