Question

Explain the auditor's responsibilities for reporting non-compliance of laws and regulations that come to his attention during the conduct of an audit.

Answer 1

An auditor is responsible for following actions for reporting non-compliance of laws and regulations that come to his attention during the conduct of an audit;

1. In this case an auditor must notify those, who are charged with governance.

2. If auditor find that persons those charged with governance are also involved in non-compliance of laws & regulation then auditor must communicate to the next highest level of authority. That higest authority may be audit committee etc.

3. If such highest authority do not exist or such highest authority also suspicious then auditor consider the need to obtain legal advice.

4. An auditor also need to consider the impact of non-compliance on the financial statements.

5. An auditor also need to consider the impact of non-compliance on the various legal report.

6. This case of non-compliance of laws & regulation may affect duty of an auditor hence auditor must consider effect on the duty of auditor so that duty of an auditor can be performed properly in such cases.