[Script Info]
Title: 
[Events]
Format: Layer, Start, End, Style, Name, MarginL, MarginR, MarginV, Effect, Text
Dialogue: 0,0:00:00.80,0:00:03.52,Default,,0000,0000,0000,,Advanced Audit Assurance, lesson one,
Dialogue: 0,0:00:03.52,0:00:05.28,Default,,0000,0000,0000,,international regulatory
Dialogue: 0,0:00:05.28,0:00:08.12,Default,,0000,0000,0000,,frameworks. And we should cover three
Dialogue: 0,0:00:08.12,0:00:11.84,Default,,0000,0000,0000,,elements. Firstly, the need for regulatory
Dialogue: 0,0:00:11.84,0:00:14.32,Default,,0000,0000,0000,,frameworks for audit and assurance.
Dialogue: 0,0:00:14.32,0:00:16.76,Default,,0000,0000,0000,,Secondly, what sort of public oversight
Dialogue: 0,0:00:16.76,0:00:19.64,Default,,0000,0000,0000,,exists of the audit profession. And
Dialogue: 0,0:00:19.64,0:00:22.36,Default,,0000,0000,0000,,thirdly, the role of corporate governance
Dialogue: 0,0:00:22.36,0:00:25.96,Default,,0000,0000,0000,,both for the entity itself, but also for
Dialogue: 0,0:00:25.96,0:00:28.52,Default,,0000,0000,0000,,the audit profession.
Dialogue: 0,0:00:29.54,0:00:30.68,Default,,0000,0000,0000,,So, let's think about what
Dialogue: 0,0:00:30.68,0:00:33.24,Default,,0000,0000,0000,,sort of regulatory framework exists for
Dialogue: 0,0:00:33.24,0:00:36.76,Default,,0000,0000,0000,,audit and assurance and why we need them.
Dialogue: 0,0:00:36.76,0:00:40.40,Default,,0000,0000,0000,,Now it's important for a recap here and for
Dialogue: 0,0:00:40.40,0:00:44.56,Default,,0000,0000,0000,,you to recall what previous studies
Dialogue: 0,0:00:44.56,0:00:47.04,Default,,0000,0000,0000,,taught you about an assurance engagement.
Dialogue: 0,0:00:47.04,0:00:48.40,Default,,0000,0000,0000,,And let's have a look at the paragraph
Dialogue: 0,0:00:48.40,0:00:52.24,Default,,0000,0000,0000,,from the IAASB glossary. So an assurance
Dialogue: 0,0:00:52.24,0:00:53.96,Default,,0000,0000,0000,,engagement is one in which a
Dialogue: 0,0:00:53.96,0:00:56.20,Default,,0000,0000,0000,,practitioner expresses a conclusion
Dialogue: 0,0:00:56.20,0:00:57.60,Default,,0000,0000,0000,,designed to enhance the degree of
Dialogue: 0,0:00:57.60,0:01:00.32,Default,,0000,0000,0000,,confidence of the intended users other
Dialogue: 0,0:01:00.32,0:01:03.32,Default,,0000,0000,0000,,than the responsible party. So there are
Dialogue: 0,0:01:03.32,0:01:08.56,Default,,0000,0000,0000,,three parties to this arrangement.
Dialogue: 0,0:01:08.56,0:01:10.57,Default,,0000,0000,0000,,Firstly, the practitioner.
Dialogue: 0,0:01:11.49,0:01:13.72,Default,,0000,0000,0000,,Secondly, the intended user.
Dialogue: 0,0:01:13.72,0:01:16.68,Default,,0000,0000,0000,,And third, the responsible party. The
Dialogue: 0,0:01:16.68,0:01:19.28,Default,,0000,0000,0000,,responsible party is responsible for the
Dialogue: 0,0:01:19.28,0:01:22.36,Default,,0000,0000,0000,,subject matter. The practitioner is there
Dialogue: 0,0:01:22.36,0:01:25.56,Default,,0000,0000,0000,,to verify and provide assurance about
Dialogue: 0,0:01:25.56,0:01:28.76,Default,,0000,0000,0000,,that subject matter in order to provide
Dialogue: 0,0:01:28.76,0:01:30.80,Default,,0000,0000,0000,,a degree of confidence that that
Dialogue: 0,0:01:30.80,0:01:33.88,Default,,0000,0000,0000,,information does have validity for the
Dialogue: 0,0:01:33.88,0:01:35.42,Default,,0000,0000,0000,,intended user.
Dialogue: 0,0:01:36.52,0:01:41.24,Default,,0000,0000,0000,,Now what sort of need is this for
Dialogue: 0,0:01:41.24,0:01:43.44,Default,,0000,0000,0000,,well ultimately the intended user needs
Dialogue: 0,0:01:43.44,0:01:46.24,Default,,0000,0000,0000,,to make an informed investment decision
Dialogue: 0,0:01:46.24,0:01:49.40,Default,,0000,0000,0000,,based upon the information that is being
Dialogue: 0,0:01:49.40,0:01:51.76,Default,,0000,0000,0000,,presented and therefore if there's a
Dialogue: 0,0:01:51.76,0:01:54.12,Default,,0000,0000,0000,,knowledge that that information has been
Dialogue: 0,0:01:54.12,0:01:56.60,Default,,0000,0000,0000,,reviewed by a third
Dialogue: 0,0:01:56.60,0:02:00.04,Default,,0000,0000,0000,,party then that enhances confidence it
Dialogue: 0,0:02:00.04,0:02:03.88,Default,,0000,0000,0000,,enhances trust it enhances Reliance on
Dialogue: 0,0:02:03.88,0:02:06.24,Default,,0000,0000,0000,,the information in order to make those
Dialogue: 0,0:02:06.24,0:02:09.00,Default,,0000,0000,0000,,informed investment decisions and
Dialogue: 0,0:02:09.00,0:02:11.80,Default,,0000,0000,0000,,hopefully it has minimized or at least
Dialogue: 0,0:02:11.80,0:02:14.60,Default,,0000,0000,0000,,reduced any potential bias in that
Dialogue: 0,0:02:14.60,0:02:16.64,Default,,0000,0000,0000,,information because it's being looked at
Dialogue: 0,0:02:16.64,0:02:19.84,Default,,0000,0000,0000,,by a third independent
Dialogue: 0,0:02:19.84,0:02:23.48,Default,,0000,0000,0000,,party so it's all about enhancing
Dialogue: 0,0:02:23.48,0:02:26.32,Default,,0000,0000,0000,,confidence allowing the user of the
Dialogue: 0,0:02:26.32,0:02:28.68,Default,,0000,0000,0000,,information to have the confidence to
Dialogue: 0,0:02:28.68,0:02:31.16,Default,,0000,0000,0000,,use that information to make an informed
Dialogue: 0,0:02:31.16,0:02:34.00,Default,,0000,0000,0000,,investment decision so that's the
Dialogue: 0,0:02:34.00,0:02:36.36,Default,,0000,0000,0000,,objective of an assurance engagement
Dialogue: 0,0:02:36.36,0:02:39.96,Default,,0000,0000,0000,,okay it is there to enhance
Dialogue: 0,0:02:41.24,0:02:43.24,Default,,0000,0000,0000,,confidence now we need to think about
Dialogue: 0,0:02:43.24,0:02:46.40,Default,,0000,0000,0000,,what's happened to the order profession
Dialogue: 0,0:02:46.40,0:02:49.64,Default,,0000,0000,0000,,uh recently in the headlines and
Dialogue: 0,0:02:49.64,0:02:51.20,Default,,0000,0000,0000,,unfortunately there have been a number
Dialogue: 0,0:02:51.20,0:02:53.68,Default,,0000,0000,0000,,of corporate failures that have existed
Dialogue: 0,0:02:53.68,0:02:55.40,Default,,0000,0000,0000,,over the last few
Dialogue: 0,0:02:55.40,0:02:58.44,Default,,0000,0000,0000,,years now notice I'm talking about
Dialogue: 0,0:02:58.44,0:03:00.64,Default,,0000,0000,0000,,corporate failures
Dialogue: 0,0:03:00.64,0:03:03.08,Default,,0000,0000,0000,,sometimes individuals often talk about
Dialogue: 0,0:03:03.08,0:03:05.08,Default,,0000,0000,0000,,ordered failures but this is not
Dialogue: 0,0:03:05.08,0:03:07.92,Default,,0000,0000,0000,,appropriate it's a corporate failure so
Dialogue: 0,0:03:07.92,0:03:11.44,Default,,0000,0000,0000,,wire card in Germany corillian and ptis
Dialogue: 0,0:03:11.44,0:03:13.60,Default,,0000,0000,0000,,Valerie in the United
Dialogue: 0,0:03:13.60,0:03:17.40,Default,,0000,0000,0000,,Kingdom these organizations that have
Dialogue: 0,0:03:17.40,0:03:21.68,Default,,0000,0000,0000,,failed and from these failures have come
Dialogue: 0,0:03:21.68,0:03:24.08,Default,,0000,0000,0000,,criticism of the external
Dialogue: 0,0:03:24.08,0:03:26.92,Default,,0000,0000,0000,,Auditors the criticism being that the
Dialogue: 0,0:03:26.92,0:03:29.48,Default,,0000,0000,0000,,work that they have done was of poor
Dialogue: 0,0:03:29.48,0:03:30.36,Default,,0000,0000,0000,,quality
Dialogue: 0,0:03:30.36,0:03:33.52,Default,,0000,0000,0000,,that they hadn't done enough nor had
Dialogue: 0,0:03:33.52,0:03:35.92,Default,,0000,0000,0000,,they raised this
Dialogue: 0,0:03:35.92,0:03:38.44,Default,,0000,0000,0000,,alarm when going through this
Dialogue: 0,0:03:38.44,0:03:40.84,Default,,0000,0000,0000,,information and realizing that there was
Dialogue: 0,0:03:40.84,0:03:44.32,Default,,0000,0000,0000,,some sort of financial
Dialogue: 0,0:03:44.32,0:03:46.52,Default,,0000,0000,0000,,difficulty now a reaction to these
Dialogue: 0,0:03:46.52,0:03:49.64,Default,,0000,0000,0000,,corporate failures has therefore
Dialogue: 0,0:03:49.64,0:03:53.52,Default,,0000,0000,0000,,resulted in this increase regulation and
Dialogue: 0,0:03:53.52,0:03:55.12,Default,,0000,0000,0000,,certainly an increase in public
Dialogue: 0,0:03:55.12,0:03:58.72,Default,,0000,0000,0000,,oversight of what Auditors actually do
Dialogue: 0,0:03:58.72,0:04:01.40,Default,,0000,0000,0000,,it's all about remember the enhancement
Dialogue: 0,0:04:01.40,0:04:04.52,Default,,0000,0000,0000,,of confidence of the user in order to
Dialogue: 0,0:04:04.52,0:04:07.96,Default,,0000,0000,0000,,make an informed investment
Dialogue: 0,0:04:07.96,0:04:10.80,Default,,0000,0000,0000,,decision now why do we need
Dialogue: 0,0:04:10.80,0:04:13.48,Default,,0000,0000,0000,,regulation well we need to ensure that
Dialogue: 0,0:04:13.48,0:04:14.88,Default,,0000,0000,0000,,the standard of
Dialogue: 0,0:04:14.88,0:04:18.16,Default,,0000,0000,0000,,work being performed by an auditor is
Dialogue: 0,0:04:18.16,0:04:20.28,Default,,0000,0000,0000,,being monitored okay so where does this
Dialogue: 0,0:04:20.28,0:04:22.48,Default,,0000,0000,0000,,come from well it comes from the audit
Dialogue: 0,0:04:22.48,0:04:26.36,Default,,0000,0000,0000,,industry itself the actual firm itself
Dialogue: 0,0:04:26.36,0:04:30.64,Default,,0000,0000,0000,,who requires quality procedures but also
Dialogue: 0,0:04:30.64,0:04:34.40,Default,,0000,0000,0000,,independent Regulators so Regulators who
Dialogue: 0,0:04:34.40,0:04:38.12,Default,,0000,0000,0000,,have oversight of the ordered firms
Dialogue: 0,0:04:38.12,0:04:40.80,Default,,0000,0000,0000,,themselves we need to ensure there is
Dialogue: 0,0:04:40.80,0:04:43.48,Default,,0000,0000,0000,,constant high quality work we need to
Dialogue: 0,0:04:43.48,0:04:45.72,Default,,0000,0000,0000,,ensure there's sufficient work being
Dialogue: 0,0:04:45.72,0:04:48.92,Default,,0000,0000,0000,,done in terms of enhancing the
Dialogue: 0,0:04:48.92,0:04:51.64,Default,,0000,0000,0000,,confidence of the user in terms of the
Dialogue: 0,0:04:51.64,0:04:54.20,Default,,0000,0000,0000,,information being presented and
Dialogue: 0,0:04:54.20,0:04:56.88,Default,,0000,0000,0000,,ultimately we are there to protect the
Dialogue: 0,0:04:56.88,0:05:01.28,Default,,0000,0000,0000,,reputation of this quality profession
Dialogue: 0,0:05:01.28,0:05:03.48,Default,,0000,0000,0000,,now where does this audit regulation
Dialogue: 0,0:05:03.48,0:05:06.28,Default,,0000,0000,0000,,derive from well it comes from three
Dialogue: 0,0:05:06.28,0:05:10.20,Default,,0000,0000,0000,,main areas firstly actual auditing
Dialogue: 0,0:05:10.20,0:05:12.64,Default,,0000,0000,0000,,standards but also standards in relation
Dialogue: 0,0:05:12.64,0:05:15.68,Default,,0000,0000,0000,,to Assurance engagements now this is a
Dialogue: 0,0:05:15.68,0:05:18.32,Default,,0000,0000,0000,,sort of form of self-regulation so the
Dialogue: 0,0:05:18.32,0:05:20.16,Default,,0000,0000,0000,,profession itself produces these
Dialogue: 0,0:05:20.16,0:05:23.28,Default,,0000,0000,0000,,standards but of course we perform this
Dialogue: 0,0:05:23.28,0:05:28.08,Default,,0000,0000,0000,,work within the rapper of a law and
Dialogue: 0,0:05:28.08,0:05:30.64,Default,,0000,0000,0000,,therefore there there will be UK
Dialogue: 0,0:05:30.64,0:05:32.24,Default,,0000,0000,0000,,there'll be International there'll be
Dialogue: 0,0:05:32.24,0:05:35.36,Default,,0000,0000,0000,,laws regulations to actually govern what
Dialogue: 0,0:05:35.36,0:05:38.00,Default,,0000,0000,0000,,sort of information um is being used in
Dialogue: 0,0:05:38.00,0:05:41.52,Default,,0000,0000,0000,,order to be able to enhance that
Dialogue: 0,0:05:41.52,0:05:44.32,Default,,0000,0000,0000,,confidence the Auditors have a duty of
Dialogue: 0,0:05:44.32,0:05:47.20,Default,,0000,0000,0000,,care for The Wider or to The Wider
Dialogue: 0,0:05:47.20,0:05:49.64,Default,,0000,0000,0000,,public and therefore there will also be
Dialogue: 0,0:05:49.64,0:05:53.00,Default,,0000,0000,0000,,potential independent Regulators outside
Dialogue: 0,0:05:53.00,0:05:56.20,Default,,0000,0000,0000,,of the firms to ensure that the audit is
Dialogue: 0,0:05:56.20,0:05:59.04,Default,,0000,0000,0000,,being done correctly the quality level
Dialogue: 0,0:05:59.04,0:06:01.00,Default,,0000,0000,0000,,is very very high and that these
Dialogue: 0,0:06:01.00,0:06:04.24,Default,,0000,0000,0000,,auditing standards which are hopefully
Dialogue: 0,0:06:04.24,0:06:08.96,Default,,0000,0000,0000,,fit for purpose are actually being
Dialogue: 0,0:06:09.00,0:06:11.92,Default,,0000,0000,0000,,implemented so in relation to the
Dialogue: 0,0:06:11.92,0:06:16.24,Default,,0000,0000,0000,,standards well we have this term the
Dialogue: 0,0:06:16.24,0:06:19.36,Default,,0000,0000,0000,,iasb so the international auditing and
Dialogue: 0,0:06:19.36,0:06:22.16,Default,,0000,0000,0000,,Assurance Standards Board and we have
Dialogue: 0,0:06:22.16,0:06:26.60,Default,,0000,0000,0000,,the ESB a the International Ethics
Dialogue: 0,0:06:26.60,0:06:29.64,Default,,0000,0000,0000,,Standards Board and these organizations
Dialogue: 0,0:06:29.64,0:06:32.92,Default,,0000,0000,0000,,produce codes but also the actual
Dialogue: 0,0:06:32.92,0:06:35.72,Default,,0000,0000,0000,,standards which have got to be adopted
Dialogue: 0,0:06:35.72,0:06:37.96,Default,,0000,0000,0000,,internationally when going through an
Dialogue: 0,0:06:37.96,0:06:41.20,Default,,0000,0000,0000,,audit and also an insurance
Dialogue: 0,0:06:41.20,0:06:43.04,Default,,0000,0000,0000,,engagement now we have this
Dialogue: 0,0:06:43.04,0:06:45.80,Default,,0000,0000,0000,,International Federation of accountants
Dialogue: 0,0:06:45.80,0:06:48.32,Default,,0000,0000,0000,,and it is the
Dialogue: 0,0:06:48.32,0:06:50.72,Default,,0000,0000,0000,,ifac
Dialogue: 0,0:06:50.72,0:06:53.20,Default,,0000,0000,0000,,Federation in which the
Dialogue: 0,0:06:53.20,0:06:57.20,Default,,0000,0000,0000,,iasb and also the I ESB so the Standards
Dialogue: 0,0:06:57.20,0:07:01.52,Default,,0000,0000,0000,,Board and the ethics board exist
Dialogue: 0,0:07:03.04,0:07:04.20,Default,,0000,0000,0000,,the
Dialogue: 0,0:07:04.20,0:07:07.56,Default,,0000,0000,0000,,iasb they produce these isers the
Dialogue: 0,0:07:07.56,0:07:09.80,Default,,0000,0000,0000,,international standards on
Dialogue: 0,0:07:09.80,0:07:12.68,Default,,0000,0000,0000,,auditing which is the
Dialogue: 0,0:07:12.68,0:07:17.20,Default,,0000,0000,0000,,framework against which an audit must be
Dialogue: 0,0:07:17.20,0:07:19.84,Default,,0000,0000,0000,,conducted and the international ethic
Dialogue: 0,0:07:19.84,0:07:23.00,Default,,0000,0000,0000,,Standards Board the iesba produces a
Dialogue: 0,0:07:23.00,0:07:25.96,Default,,0000,0000,0000,,code a code of ethics for professional
Dialogue: 0,0:07:25.96,0:07:29.68,Default,,0000,0000,0000,,accountants a code which must exist when
Dialogue: 0,0:07:29.68,0:07:32.80,Default,,0000,0000,0000,,doing an audit but also in the actual
Dialogue: 0,0:07:32.80,0:07:35.52,Default,,0000,0000,0000,,daily life of an external auditor and a
Dialogue: 0,0:07:35.52,0:07:37.64,Default,,0000,0000,0000,,professional
Dialogue: 0,0:07:37.64,0:07:39.68,Default,,0000,0000,0000,,accountant now these are
Dialogue: 0,0:07:39.68,0:07:43.96,Default,,0000,0000,0000,,international and every country will
Dialogue: 0,0:07:43.96,0:07:47.00,Default,,0000,0000,0000,,differ slightly and therefore it's
Dialogue: 0,0:07:47.00,0:07:51.52,Default,,0000,0000,0000,,absolutely vital that these standards
Dialogue: 0,0:07:51.52,0:07:53.84,Default,,0000,0000,0000,,are not followed blindly but are
Dialogue: 0,0:07:53.84,0:07:57.12,Default,,0000,0000,0000,,potentially adapted to ensure that it is
Dialogue: 0,0:07:57.12,0:07:59.52,Default,,0000,0000,0000,,relevant for the or for the area for the
Dialogue: 0,0:07:59.52,0:08:01.84,Default,,0000,0000,0000,,the country in which this orders is
Dialogue: 0,0:08:01.84,0:08:05.44,Default,,0000,0000,0000,,being produced and hence as I've said
Dialogue: 0,0:08:05.44,0:08:08.28,Default,,0000,0000,0000,,there across the globe across the world
Dialogue: 0,0:08:08.28,0:08:11.16,Default,,0000,0000,0000,,we have more than a 100 countries which
Dialogue: 0,0:08:11.16,0:08:14.32,Default,,0000,0000,0000,,have taken the auditing standards and
Dialogue: 0,0:08:14.32,0:08:16.76,Default,,0000,0000,0000,,they have adopted them
Dialogue: 0,0:08:16.76,0:08:19.72,Default,,0000,0000,0000,,and they either used them or they've
Dialogue: 0,0:08:19.72,0:08:21.60,Default,,0000,0000,0000,,slightly amended them so that they have
Dialogue: 0,0:08:21.60,0:08:24.24,Default,,0000,0000,0000,,their own national standards But
Dialogue: 0,0:08:24.24,0:08:26.76,Default,,0000,0000,0000,,ultimately the auditing standards the
Dialogue: 0,0:08:26.76,0:08:30.20,Default,,0000,0000,0000,,ethical standards are against which
Dialogue: 0,0:08:30.20,0:08:32.72,Default,,0000,0000,0000,,you must
Dialogue: 0,0:08:33.76,0:08:38.28,Default,,0000,0000,0000,,work now in the UK we have um isas but
Dialogue: 0,0:08:38.28,0:08:42.32,Default,,0000,0000,0000,,notice it's isas UK because they've been
Dialogue: 0,0:08:42.32,0:08:46.84,Default,,0000,0000,0000,,slightly adapted in order U to uh be
Dialogue: 0,0:08:46.84,0:08:49.56,Default,,0000,0000,0000,,consistent with the UK
Dialogue: 0,0:08:49.56,0:08:53.16,Default,,0000,0000,0000,,Market in relation to the code of ethics
Dialogue: 0,0:08:53.16,0:08:56.52,Default,,0000,0000,0000,,well we have the acca's code of ethics
Dialogue: 0,0:08:56.52,0:08:59.44,Default,,0000,0000,0000,,which is based upon the ethics standards
Dialogue: 0,0:08:59.44,0:09:05.24,Default,,0000,0000,0000,,board code and in which you must
Dialogue: 0,0:09:05.44,0:09:09.52,Default,,0000,0000,0000,,work now the a a I apologize the
Dialogue: 0,0:09:09.52,0:09:14.00,Default,,0000,0000,0000,,iasb also produces other standards so
Dialogue: 0,0:09:14.00,0:09:15.68,Default,,0000,0000,0000,,they include standards on what sort of
Dialogue: 0,0:09:15.68,0:09:18.16,Default,,0000,0000,0000,,quality control must exist within an
Dialogue: 0,0:09:18.16,0:09:20.52,Default,,0000,0000,0000,,audit but also an audit
Dialogue: 0,0:09:20.52,0:09:23.52,Default,,0000,0000,0000,,firm they produce is
Dialogue: 0,0:09:23.52,0:09:26.32,Default,,0000,0000,0000,,AES which are standards on Assurance
Dialogue: 0,0:09:26.32,0:09:28.36,Default,,0000,0000,0000,,engagements which of course include
Dialogue: 0,0:09:28.36,0:09:30.64,Default,,0000,0000,0000,,audit
Dialogue: 0,0:09:30.64,0:09:31.84,Default,,0000,0000,0000,,we also have
Dialogue: 0,0:09:31.84,0:09:35.72,Default,,0000,0000,0000,,isres which provide standards on a
Dialogue: 0,0:09:35.72,0:09:38.36,Default,,0000,0000,0000,,review engagement okay which differs
Dialogue: 0,0:09:38.36,0:09:41.48,Default,,0000,0000,0000,,from an audit differing level of
Dialogue: 0,0:09:41.48,0:09:45.24,Default,,0000,0000,0000,,assurance and we have is rs's standards
Dialogue: 0,0:09:45.24,0:09:48.40,Default,,0000,0000,0000,,on related
Dialogue: 0,0:09:49.44,0:09:54.32,Default,,0000,0000,0000,,services so the Isis apply to audits but
Dialogue: 0,0:09:54.32,0:09:57.40,Default,,0000,0000,0000,,also all of these individual standards
Dialogue: 0,0:09:57.40,0:09:59.88,Default,,0000,0000,0000,,they also provide or they also
Dialogue: 0,0:09:59.88,0:10:01.36,Default,,0000,0000,0000,,relate to Audits and Assurance
Dialogue: 0,0:10:01.36,0:10:03.68,Default,,0000,0000,0000,,engagements as well and we will use
Dialogue: 0,0:10:03.68,0:10:07.92,Default,,0000,0000,0000,,these going forward