BUSINESS SCHOOL

Unit of Study Outline

Unit Code ACCT6007 Unit Title Contemporary Issues in Auditing Semester 2, 2013
Pre-requisite Units: ACCT6001 Co-requisite Units: Prohibited Units: Assumed Knowledge and/or Skills: Students are expected to have a general understanding of the business financial reporting and legal environment in which listed corporations operate. Students are also expected to have a general understanding of the role of accounting and public disclosure as an information decision making stream for stakeholders

Unit Coordinator: Sandra Van Der Laan Address: Room 341, The Business School Building(H69), The University of Sydney NSW 2006 Email: sandra.vanderlaan@sydney.edu.au Phone: 93516431 Consultation Hours: Please go to Blackboard for details of all staff consultation times. Class Day(s): Stream 1 - Wednesdays 6pm to 9pm Merewether Lecture Theatre 2; Stream 2 - Thursdays 10am to 1pm Slade Lecture Theatre.

Required Text / Resources: Gay & Simnett (2012) Auditing and Assurance Services in Australia 5th Edition, McGraw-Hill Australia, North Ryde NSW Australia ISBN: 978-8-0-07028674-0 Custom Text ACCT6007 Contemporary Issues in Auditing 2013, (Thibodeau & Freier (2011) Auditing and Accounting Cases 3rd Edition, McGraw-Hill New York, NY) ISBN: 978-0-07-811081-8 Knapp, M.C. (2013) Contemporary Auditing 9th Edition, Cengage Learning, Mason OH, USA ISBN:978-1-1-3318789-9 (selected E-Chapters only)
This Guide to Unit Learning Content and Assessment MUST be read in conjunction with the Business School Student Administration Manual for information about all processes (sydney.edu.au/business/currentstudents/student_information/student_administration_manual) and the Business School unit of study common policy and implementation information that apply to every unit of study offered by the Business School (http://sydney.edu.au/business/currentstudents/policy). In determining applications and appeals relating to these matters it will be assumed that every student has taken the time to familiarise themselves with these key policies and procedures.

Version: 2013 Business School

BUSINESS SCHOOL

1. Unit of study information This unit seeks to improve students' understanding of the function, nature and procedures of commercial auditing in the context of corporate financial reporting. It has particular regard to the business, legal and economic foundations than underpin the audit process. Recurrent reference is made to practical and policy matters of contemporary importance to auditing and auditors, especially as they relate to the function of auditing in ensuring the quality of corporate financial statements and the role of auditors in corporate governance. Matters related to modern cases like Enron, HIH, One.Tel, Parmalat, China Aviation Oil and ABC Learning are also discussed.

2. Program learning outcomes 1. Accounting Knowledge: Our Masters programs develop each graduate to be a knowledgeable business practitioner leading to students who are able to demonstrate an advanced integrated understanding of accounting principles, techniques, standards, regulatory requirements and current global developments in accounting and reporting. (Assured in ACCT6010) 2. Critical Thinking: Our Masters programs develop each graduate to be an autonomous and constructive critical thinker leading to students who are able to interrogate, evaluate and respond creatively to assumptions, propositions and debates within the field of accounting. (Assured in ACCT6010) 3. Business Analysis and Problem-Solving: Our Masters programs develop each graduate to be a capable business analyst and strategic problem-solver leading to students who are able to identify and diagnose complex and unfamiliar challenges and opportunities in accounting and reporting, in diverse contexts and formulate strategically-appropriate solutions. (Assured in ACCT6010) 4. Communication: Our Masters programs develop each graduate to be a persuasive communicator and negotiator leading to students who are able to reach agreement with others about appropriate responses to problems and opportunities within accounting and reporting, using a range of communication strategies. (Written communication assured in ACCT6010) 5. Team Working: Our Masters programs develop each graduate to be a capable team leader in work-related contexts leading to students who are able to influence others to work collaboratively to address complex business challenges and opportunities in accounting and reporting in diverse contexts. 6. Ethical and Social Responsibility: Our Masters programs develop each graduate to be an ethically- and socially-responsible professional leading to students who are able to demonstrate social, ethical, personal and professional considerations in the field of accounting and reporting.

3. Unit learning objectives

This unit aims to integrate students understanding of the function, nature and procedures of commercial auditing in the context of corporate financial reporting. It seeks to contrast alternative views on several contemporary auditing issues, drawing on the differing technical skills and the complex auditing environment deveolped in the three prescribed texts. Whereas the scope of this unit is broad covering conceptual, ethical, policy and technical matters the

Version: 2013 Business School

BUSINESS SCHOOL

unit is integrated with contemporary local and international case studies. Accordingly, the study of auditing foundations, procedures and standards will focus on the complexities facing the auditing profession in the 21st century, and will cover the following broad topic areas: 1. the concept of reasonable assurance and the quality control of the audit function; 2. the evidence collection and evaluation process throughout all stages of a public company financial audit; 3. the need for auditor independence and professional scepticism in judgment formation; 4. the communication and reporting of audit findings to key stakeholders, and 5. the difficulties faced by the auditing profession linking to corporate financial distress or corporate failure To enhance the understanding of the business, legal and economic facets of auditing, we shall examine several actual cases that illustrate auditing complexities and the reoccurrence of corporate failure or financial distress.

This unit draws upon prior units of study in which accounting, legal skills and knowledge have been studied. Issues in auditing are pursued as being dependent upon the effectiveness of accounting in disclosing the wealth and progress of companies, and the effectiveness of current accounting standards to make published financial statement auditable.

At the conclusion of this UoS, students are expected to be able to: Demonstrate an understanding of linkages between auditing, underlying accounting data/information and issues of auditing corporate groups Communicate effectively in verbal, written and group contexts to a professional standard Present detailed and clear explanations of accounting and auditing concepts, relationship and constraints Demonstrate an understanding of ethical issues surrounding auditors and auditing Apply audit theory to practice in familiar and unfamiliar situations.

Version: 2013 Business School

BUSINESS SCHOOL

4. Assessment
Assessment Name Group Case Study Mid Semester Examination Final Examination Academic Honesty Work Type Both Individual Individual Program Learning Outcomes Assessed 1, 2, 3, 4, 5 2, 3, 6 2, 4, 6 Length Weight Due Date 1200 1500 3000 20% 30% 50% Closing Date

Weekly Weekly 14-Sep-2013 14-Sep-2013 Exam Period Exam Period Week 4

Assessment Group Case Study is Compulsory. This means you must undertake the assessment. If you do not undertake the assessment you will receive zero for this assessment. Assessment Mid Semester Examination is Compulsory. This means you must undertake the assessment. If you do not undertake the assessment you will receive zero for this assessment. Assessment Final Examination is Mandatory. This means you must undertake the assessment and achieve a mark above 40%. Students who fail to achieve this minimum standard in this assessment, even when their aggregate mark for the entire unit is above 50%, will be given an AF grade for this unit. As a result a student's academic transcript will show AF and the actual mark achieved if between 0-49 and AF and a capped mark of 49 for all other marks. ** Students must complete the Academic Honesty module in Blackboard with a mark above 80% by the final day of exam, or an Absent Fail (AF) grade will be given for the entire unit. Students can complete the module multiple times until this grade is achieved. Students who completed the module with a score of 80% or above in any previous semesters do not need to do it again. *** The due date for an assessment is the last day on which you can submit the assessment without penalty. If you submit the assessment after that date, you will receive a late penalty, unless excused by special consideration, special arrangement or disability services adjustment. The closing date is the last day on which an assessment will be accepted for marking. A task occurs over a number of weeks, e.g. class presentations, due and closing date are both the first occasion of the task. Conditions of Assessment The Business School has standard conditions governing assessments such as late penalties, word length and so on. Please go to the Business School policy and implementation information at http://sydney.edu.au/business/currentstudents/policy

Referencing Style Students should adhere to the Business School Referencing Guide at http://sydney.edu.au/business/reference_guide

Version: 2013 Business School

BUSINESS SCHOOL

Assessment details Group Case Study

G

Task Description Group Case Study Due in Weeks 9 and 10 - Total value = 20% In Week 4 of the Semester students will be allocated to a case study groups randomly by the UoS Coordinator. Subject to final student enrolments in this UoS it is expected that each case study group will comprise 4 students, and students will be advised of their group allocation via Blackboard. The allocation process will also provide students with the name of case study they are to prepare and when the oral presentations and and group written reports are due. Please note that once the allocation of students to case study groups has been completed by the UoS Coordinator, membership of student groups will not be changed. The Group Case Study assessment will comprise two parts: 1. Oral presentation - by the group of its case study to its allocated seminar stream (value of 10%), and 2. A written group report - on the same case study that will be submitted via TURNITIN in Blackboard. (value 10%). Part One: Oral Presentation: each student assessed on an individual basis value 10% The group case study presentations will occur as time tabled in the Detailed Weekly Schedule for this UoS uploaded to Blackboard. Case study presentation guidelines and questions to be addressed by each group will be released in week 4 to allow students to seek any clarification of requirements of the group case study before any group case studies are presented. Each case study group will have a maximum of 20 minutes to present their case study. It is expected that each student would equally share the time allocated (a max of 5 mins per student). No individual student is to present for more than 5 minutes. Any student exceeding the 5 minute time limit shall be penalised 10% of their individual presentation mark for each minute or part thereof that exceeds the 5 minute time limit. While each student shall be assessed as an individual for this part of the group case study, the presentation must provide a cohesive view of the material researched by the group. Part Two: Written Group Case Study Report: assessed on a group basis value 10% The word limit for the written group report shall be 900 words (this word limit excludes any reference list). The written group report is an academic written report which is to concisely reflect the key issues and questions addressed in the group presentation delivered on the same group case study. As an academic written report it must be correctly referenced and comply with the Business Schools referencing guide lines. A 10% penalty shall apply to any written group report not adhering to the guidelines. The written group report must be uploaded to TURNITIN via Blackboard by 4:00pm on the Wednesday of the

Version: 2013 Business School

BUSINESS SCHOOL

week in which the group are to undertake their oral case study presentation. The written group report must have the names and SIDs of each student member of the group as a footer in the document uploaded to Blackboard. A late penalty of 10% per day or part thereof shall apply to any written group case study report submitted after the Wednesday 4:00pm due date and time. No written group report will be accepted for marking more than 1 week overdue. As this assessment item is assessed as a group the same mark will be given to each group member and all members shall be subject to any penalties applied equally. Student Contribution Statement Each submitted written group report must include a 1 page member contribution statement. The 1 page statement is excluded from the 900 word limit. A template for student groups to use for the completion of this contribution statement will be uploaded to Blackboard and only this template may be used by student groups. The contribution statement must not exceed 1 A4 page and must provide the information required in the template. The template shall not be altered or amended in any way. A penalty of 10% shall be applied to any submitted written report that fails to have the contribution statement fully completed, limited to 1 page A4 in length and submitted online by the same time and due date of the linked written report.
G

Assessment Criteria 1. Conforming with instructions (e.g. word length, font, other instructions) 2. Presentation, communication & style (written) 3. Clarity of expression (incl. accuracy, spelling, grammar, punctuation) 4. Referencing 5. Use of literature/ Knowledge of theory

Mid Semester Examination

G

Task Description Mid-semester examination value 30% The mid-semester examination will be held on Saturday, 14th September 2013, at 10:00am, Teachers College Hall As this is a Saturday scheduled event students need to note their calendar now to avoid any clashes that would prevent attendance. The exam will contain both multiple choice and short answer questions. The exam will comprise a comprehensive examination of the material presented in the weekly seminars for weeks 1 to 7 inclusive. Please refer to section 7 of this UoS Outline for the topic areas to be covered by this exam. A mini practise exam will be handed out to students in seminars in Week 7. This will assist students understand the type and structure of questions that will form part of the mid semester exam paper. The exam will run for 90 minutes inclusive of reading time. The exam is closed book, and calculators are not permitted. Students will need to show their 2013 valid University of Sydney student card to gain access to the exam room.

Version: 2013 Business School

BUSINESS SCHOOL

Assessment Criteria 1. Conforming with instructions (e.g. word length, font, other instructions) 2. Clarity of expression (incl. accuracy, spelling, grammar, punctuation) 3. Use of literature/ Knowledge of theory 4. Conclusions

Final Examination
G

Task Description Final Examination value 50% The final examination will be based on all the work covered in this UoS for the semester. It is emphasised that attendance at seminars is a necessary but not a sufficient condition for adequate examination preparation. All students should refer to: 1. Seminar powerpoints and Lecturer delivered content 2. Any Seminar handouts (all such handouts will be accessable via Blackboard) 3. The group case study oral presentations and lecturer lead end of presentation summaries. 4. Their respective group case study research, 5. The course review and final examination information document, 6. The sited sections of the prescribed textbooks, and 7. Highlighted sections of the Australian Auditing Standards referred to in seminars. The date and time of the final exam will be advised by the Central Examinations Centre and students should monitor their university email account for information. The exam will be 120 minutes + 10 minutes reading time in length. It will consist of multiple choice questions and extended response questions. Further details will be provided to students in week 13 of the UoS. The exam will again be closed book and calculators will not be permitted. Assessment Criteria 1. Conforming with instructions (e.g. word length, font, other instructions) 2. Clarity of expression (incl. accuracy, spelling, grammar, punctuation) 3. Use of literature/ Knowledge of theory 4. Conclusions

5. Other suggested resources for students All lectures and seminars are recorded and will be available within Blackboard for student use. Please note the Business School does not own the system and cannot guarantee that the system will operate or that every class will be recorded. Students should ensure they attend and participate in all classes. Please note that as student groups will be presenting assessable group case studies in the seminar stream periods, for the purpose of this UoS (ACCT6007), weekly seminar streams will not be recorded or publicly released. Students are strongly urged to attend their allocated seminar stream as a means of achieving a positive result in this UoS. Students are advised that the Australian Auditing Standards (ASAs) can be located directly from the AuASB website:

Version: 2013 Business School

BUSINESS SCHOOL

http://www.auasb.gov.au/Standards-and-Guidance/Australian-Auditing-Standards-in-Clarity-format.aspx

Given the contemporary nature of this Unit of Study, students are encouraged to regularly review material contained in the Library Factevia electronic database. This database provides up-to-date commentary on both general audit issues and from time to time material related to some of the case studies examined in this Unit of Study.

6. Feedback and improvements made in response to feedback The Business School seeks feedback from students and staff in order to continually improve and innovate all units offered. For information on previously collected feedback and innovation made in response to feedback, please see http://sydney.edu.au/business/learning/planning_and_quality/feedback/student

Version: 2013 Business School

BUSINESS SCHOOL

7. Unit schedule Week/ Topic 1 29 Jul 2013 Materials (e.g. readings) Refer Detailed Weekly Schedule Lecture/Seminar/Problem Based Learning Session Introduction to the UoS - Structure & assessments, Introduction to the importance of audits Corporate governance & fraud Auditor independence and ethics Audit planning Risk assessment Materiality, Identifying key accounts Introduction to Assertions Audit evidence, key accounts & assertions Academic Honesty Module Due Assessments Due

2 Refer Detailed Weekly 5 Aug 2013 Schedule 3 12 Aug 2013 4 19 Aug 2013 5 26 Aug 2013 6 2 Sep 2013 Refer Detailed Weekly Schedule Refer Detailed Weekly Schedule Refer Detailed Weekly Schedule Refer Detailed Weekly Schedule

7 Refer Detailed Weekly 9 Sep 2013 Schedule 8 16 Sep 2013 9 23 Sep 2013

Manual & IT internal controls and linkage to assertions Audit testing of controls Analytical procedures Substantive procedures Part 1 Substantive procedures Part 2 Using the Work of Others Mid Semester Exam Other Auditors Saturday 14 Sept Experts 2013 @ 10:00am Internal Auditors Audit reporting & subsequent events Group Case Study Presentations & Group Reports Due

Refer Detailed Weekly Schedule Refer Detailed Weekly Schedule

Student presentations Common week 30 to 6 Oct

10 Refer Detailed Weekly 7 Oct 2013 Schedule 11 14 Oct 2013 12 21 Oct 2013 13 28 Oct 2013 Refer Detailed Weekly Schedule Refer Detailed Weekly Schedule Refer Detailed Weekly Schedule

Student presentations

Group Case Study Presentations & Group Reports Due

Audit opinions, Audit quality & True & Fair Going concern issues Legal liability of auditors Course Review, Final exam preparation

Version: 2013 Business School