SRILANKA INSTITUTE OF ADVANCED

TECHNOLOGICAL EDUCATION

HIGHER NATIONAL DIPLOMA IN ACCOUNTANCY – 2017 BATCH

4TH YEAR – 2nd SEMESTER

ADVANCED AUDITING AND ASSURANCE

FACILITATOR- MR. SAGARA WIJERATNE

M F F RUSDHA

DEH/AC/2018/P/0109
Who is a practitioner?
The Practitioner is the individual providing professional services that will review the subject
matter and provide the assurance

RANGE OF PROFESSIONAL SERVICES PROVIDE BY PRACTITIONER

01. Audits
Audits provide a reasonable (high but not absolute) assurance after performing procedures to obtain
sufficient and appropriate evidence that enables the auditor to issue an opinion on a company’s
financial statements as to whether they are prepared, in all material respects, in accordance with an
applicable financial reporting framework.
02. Reviews
Reviews include performance of procedures, mainly consisting of inquiry and analytical
procedures. This enables the professional accountant to obtain limited assurance and conclude on
whether they have become aware of any matter that may cause the financial statements to be
materially misstated.
03. Other Assurance Engagements
Other Assurance Engagement include a broad category of engagements that express assurance on
engagements other than audits or reviews of historical financial information. These include specific
standards on the examination of prospective information and assurance reports on controls at a
service organization, greenhouse gas statements and reports on the compilation of pro forma
financial information included in a prospectus.
04. Agreed-Upon Procedures
Agreed Upon Procedures are engagements that do not provide any assurance regarding financial
information. The professional accountant performs specified procedures which are agreed with the
client at the outset of the engagement and are reported in a report on factual findings regarding the
financial information.
05. Compilations
Compilation are also engagements that do not provide any assurance. Under these engagements,
the professional accountant assists management with the preparation and presentation of financial
information in accordance with an applicable financial reporting framework.
06. Other Non-Assurance Engagements
Other Non-Assurance Engagements that include a wide-ranging category of professional services.
These services range from compliance oriented and traditional accountancy services (e.g. simple
bookkeeping to more complex financial analysis and accounting framework conversions) and tax
compliance services (e.g. preparing returns for tax purposes and other tax compliance
engagements), to more recently developed accounting firm service models enabled by technological
advances, advisory and consultancy services.
07. Client Accounting Services
Client Accounting Services are offered by organizations that provide automated technology and
affordable accounting guidance, these services enable to obtain bookkeeping, accounting and
controller services virtually, from remote teams of accounting experts
08. Advisory and Consultancy Services
Advisory and Consultancy services Such as management and tax consulting are enabled to use
financial information and advice to make better informed decisions on how to utilize resources
effectively.

APPLICABILITY AND ENFORCEMENT OF THE CODE OF ETHICS

There Are Five Fundamental Principles Of Ethics For Professional Accountants:
(a) Integrity – to be straightforward and honest in all professional and business relationships.
(b) Objectivity – not to compromise professional or business judgments because of bias, conflict
of interest or undue influence of others.
(c) Professional Competence and Due Care –:
I. Attain and maintain professional knowledge and skill at the level required to ensure that a
client or employing organization receives competent professional service, based on current
technical and professional standards and relevant legislation; and
II. Act diligently and in accordance with applicable technical and professional standards.
(d) Confidentiality – to respect the confidentiality of information acquired as a result of
professional and business relationships.
(e) Professional Behavior – to comply with relevant laws and regulations and avoid any conduct
that the professional accountant knows or should know might discredit the profession

HOW PRACTITIONER APPLY AND ADHERE TO CODE OF ETHICS IN

RENDERING THEIR SERVICES
01.Integrity
✓ A professional accountant shall comply with the principle of integrity, which requires an
accountant to be straightforward and honest in all professional and business relationships.
✓ Integrity implies fair dealing and truthfulness.
✓ A professional accountant shall not knowingly be associated with reports, returns,
communications or other information where the accountant believes that the information:
a) Contains a materially false or misleading statement;
b) Contains statements or information provided recklessly; or
c) Omits or obscures required information where such omission or obscurity would be
misleading.
02. Objectivity
✓ A professional accountant shall comply with the principle of objectivity, which requires an
accountant not to compromise professional or business judgment because of bias, conflict
of interest or undue influence of others.
✓
✓ A professional accountant shall not undertake a professional activity if a circumstance or
relationship unduly influences the accountant’s professional judgment regarding that
activity.
03. Professional Competence and Due Care
✓ A professional accountant shall comply with the principle of professional competence and
due care, which requires an accountant to:
a) Attain and maintain professional knowledge and skill at the level required to ensure
that a client or employing organization receives competent professional service,
based on current technical and professional standards and relevant legislation;
and
b) Act diligently and in accordance with applicable technical and professional standards.

✓ Serving clients and employing organizations with professional competence requires the
exercise of sound judgment in applying professional knowledge and skill when undertaking
professional activities.

✓ Maintaining professional competence requires a continuing awareness and an understanding

of relevant technical, professional and business developments. Continuing professional
development enables a professional accountant to develop and maintain the capabilities to
perform competently within the professional environment.

✓ Diligence encompasses the responsibility to act in accordance with the requirements of an

assignment, carefully, thoroughly and on a timely basis.

✓ In complying with the principle of professional competence and due care, a professional
accountant shall take reasonable steps to ensure that those working in a professional capacity
under the accountant’s authority have appropriate training and supervision.

✓ Where appropriate, a professional accountant shall make clients, the employing

organization, or other users of the accountant’s professional services or activities, aware of
the limitations inherent in the services or activities
04. Confidentiality
✓ A professional accountant shall comply with the principle of confidentiality, which requires an
accountant to respect the confidentiality of information acquired as a result of professional and
business relationships.
An accountant shall:
(a) Be alert to the possibility of inadvertent disclosure, including in a social environment, and
particularly to a close business associate or an immediate or a close family member;
(b) Maintain confidentiality of information within the firm or employing organization;
(c) Maintain confidentiality of information disclosed by a prospective client or employing
organization;
(d) Not disclose confidential information acquired as a result of professional and business
relationships outside the firm or employing organization without proper and specific authority,
unless there is a legal or professional duty or right to disclose;
(e) Not use confidential information acquired as a result of professional and business relationships
for the personal advantage of the accountant or for the advantage of a third party;
(f) Not use or disclose any confidential information, either acquired or received as a result of a
professional or business relationship, after that relationship has ended; and
(g) Take reasonable steps to ensure that personnel under the accountant’s control, and individuals
from whom advice and assistance are obtained, respect the accountant’s duty of confidentiality.
05. Professional Behavior
✓ A professional accountant shall comply with the principle of professional behavior, which
requires an accountant to comply with relevant laws and regulations and avoid any conduct
that the accountant knows or should know might discredit the profession. A professional
accountant shall not knowingly engage in any business, occupation or activity that impairs
or might impair the integrity, objectivity or good reputation of the profession, and as a result
would be incompatible with the fundamental principles.

✓ Conduct that might discredit the profession includes conduct that a reasonable and informed
third party would be likely to conclude adversely affects the good reputation of the
profession.

✓ When undertaking marketing or promotional activities, a professional accountant shall not

bring the profession into disrepute. A professional accountant shall be honest and truthful
and shall not make:
(a) Exaggerated claims for the services offered by, or the qualifications or experience of,
the accountant; or
(b) Disparaging references or unsubstantiated comparisons to the work of others.
✓ If a professional accountant is in doubt about whether a form of advertising or marketing is
appropriate, the accountant is encouraged to consult with the relevant professional body