Former Auditors Essay Example | Topics and Well Written Essays - 750 words

Former Auditors - Essay ExampleSub Section 324 CI does not allow a origin crack upner of an study crocked to become a ingredient of the board of directors or other officer of a Public Comp each(prenominal) which is listed, if that former provide has remained part of the audit team being involved in the audit of that public listed company at any time during the preceding two years of that partners retirement.On the other hand, more special(prenominal) legislative requirements relating to the emancipation stress of the former auditors can be found in Sub Section 324 CF (7), which states that a soulfulness is regarded as satisfying the test of independence if,i.He does not have any control over the operations or financial policies of the audit inviolable of which he was a partner or an employeeii.He does not involve himself in the activities and other operating matter of the audit firm of which he was a partner or an employeeiii.He does not hold any kind of rights as against the audit firm or any of the members of the audit firm with respect to the termination of such person from the partnership of that audit firm or other interest of whatsoeveriv.He has no monetary arrangements or intellects with respect to performance of any professional service with the audit firm from which he so retired. However, this does not includea.An agreement under which the partner so retired will be given payments of specific amounts at regular intervals of time, provided that such payments are predetermined and are independent in direct and indirect.... He has no monetary arrangements or agreements with respect to performance of any professional service with the audit firm from which he so retired. However, this does not include a. An agreement under which the partner so retired will be given payments of specific amounts at regular intervals of time, provided that such payments are predetermined and are independent in direct and indirect ways from the earnings being ma de by the audit firm, or b. An agreement under which the partner so retired will be given payments of specific amounts at regular intervals of time, provided that such payments, although not predetermined, are calculated on a predetermined basis and are independent in direct and indirect ways from the earnings being made by the audit firm and v. He has, apart from the agreements mentioned above, no other financial or monetary arrangements or agreements with the audit firm for the recognise of payment under any name which is related, either directly or indirectly, to the revenues earned by the audit firm, whether such businesses do or do not relate to such person (Corporations Act). The independence test requirements as presented in (I), (ii) and (v) above are independent of each other and these requirements do not front to cater any serious issues related to independence test in relation to a former audit partner or other professional. In other words, these requirements are not th e determinants of the fact that independence exists. This is so because a retiring or former professional cannot eliminate altogether the existence of his prehistoric relationship with an audit firm or other professional body (Brayshaw). All these independence scrutiny requirements and regulations are in fact meant for ensuring that a retired or former audit firm partner has