Question

Please explain about THE PROFESSION’S RESPONSE TO LEGAL LIABILITY below and give an example :

1. Research in auditing

2. Standard and rule setting

3. Set requirements to protect auditors

4. Establish peer review requirements

5. Oppose lawsuits

6. Education of users

7. Sanction members for improper conduct  and performance

8. Lobby for changes in laws

Answer 1

1. Research in auditing is usually conducted by professionals like Chartered Accountants. Eg: Special Audit to be conducted on XYZ Company due to doubt about correctness of accounts

2. Standard and Rule setting is proper following of prescribed rules set by the particular entity for being in disciplined manner

3. Set requirements to protect auditors is the rules presscribed in provisons of Auditing Standards

4. Establish Peer review requirements is Audit done by one CA Firm of other CA Firm to check whether Firm is working under rules and regulations as per ICAI

5. Oppose Law suits is punishing person who is victims

6. Education of Users is formal guide to instruct users and provide sufficients information

7.Sanction memeber of improper conduct and performance means professional misconduct that resulted harm to assets to the organization/entity

8 Lobby for changes in law means particular thing which should or should not be happened or changed