to the UK Corporate Governance Code an audit committee at AStunIT PLC, should
consist of at least three non – executive directors, wherein one of them should
have appropriate financial experience and qualifications from major accountancy
bodies’ e.g. ICAEW. The auditing committee should be appointed by the board and
should be approved by the nomination committee. Appointments should last 3
years, with the possibility of extending this period to another 3 years. The auditing committee should not be involved
directly in any operational management activities” (Council,
role of the auditing committee at AstunIT should consist of:
accuracy checks of financial statements and integrity of data supplied as well
as monitoring any official announcement to the report, hence improve reliabilityof
financial statement report.Formal
assessment of internal auditor’s neutrality, resulted in more effective communication
between executives, managing group and external auditors.Improvement
and implementation of non – audit services procedure.Proposal
to the board of Directors in regards to the nomination, re – nomination or
withdrawal of the external auditor. Assessing
the internal audit performance likewise inside control and risk management
system as a consequence information reported by internal audit strengthens their credibility and increase value to internal control
discussion and take in consideration any further concerns in regards to
activities of directors and internal control, furthermore create the reporting
network for any irregularities, hence preventing from wrongful or criminal
financial deception” (ICAEW, n.d.).
enhance the productiveness an audit committee, primarily should exist position
description for the audit committee chair, which should consist of foremost
principals and regulatory requirements. Without an effectual chair, an audit
committee activity is more likely to fail” (Leblanc, 2007).
should be provide induction training for a new members of auditing committee.
audit committee members should have deeper understanding of management role and
which factors have got an impact on their decision, which can lead to financial
statement manipulations, hence should receive regularly report from managers in
regards to system efficiency to evaluate and control business financial risk. Additionally
understand an approximate calculation or judgment on the value.
audit committee should held meeting in regular basis to discuss current
situation and issues arising within an organisation. In addition they should organise,
at least one a year, meeting with external and internal auditors without
presence of members of managerial group” (Assurance, n.d.).
auditor of AStunIT plc is legally responsible for civil as well as criminal a
breach of the law. Additionally criminal law is related to an organization and
e.g. government, “while civil law applies to disagreement between individuals
and a company”.
auditor responsibilities are regulated by the Company Act 2006, in particular
section 495 is concerned about auditor’s report of company’s yearly accounts.
If the auditor purposely provide misleading, false and untrue information is a
subject to penalty and can be prosecuted based on criminal law. Furthermore
civil law consist of two parts: contact and tort law, which determine
principals for auditor’s liability to client as well as third parties. Under
contract law shareholders can look for breaching of contract obligations by the
auditor, which are include in engagement letter” (TV, n.d.).