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Auditing Assignment

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4 views7 pages

Auditing Assignment

Uploaded by

glorinageorge16
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Auditing

Assignment
PROFESSIONAL ETHICS
AND MISCONDUCT OF
AUDITOR ACCORDING TO
SEC 2 CHARTERED
PROFESSIONAL ETHICS AND
MISCONDUCT
 professional ethics encompass the personal and corporate standards behaviour
expected by professionals
They are principles that govern the behaviour of a person or a group in a business
environment
Misconduct is wrongful, improper, or unlawful, conduct motivated by premeditated
or intentional purpose or by obstinate indifference to the consequences of one’s acts
Misconduct can be considered an unacceptable or improper behavior, especially for
professional person
FUNDAMENTAL PRINCIPLES OF
ETHICS FOR AN AUDITOR
Integrity : being straightforward and honest in all professional relationship
Objectivity : not allow bias, conflict of interest or undue influence of others to override
professional judgements
Professional Competence and Due Care : maintain professional knowledge and skill at the level
required to ensure that a client or employee receives competent professional service based on
current developments in practice legislation and techniques
Confidentiality : the confidentiality of information acquired should not disclose any such
information to third parties without proper and specific authority unless there is a legal or
professional right or duty to disclose.
Professional Behaviour : should comply with relevant laws and regulations and should avoid any
action that discredits the profession
SECTION 2 CHARTERED
ACCOUNTANT ACT 1949
 A member of the Institute shall be deemed, "to be in practice ",when individually or in partnership
with chartered accountants in practice, he, in consideration of remuneration received or to be
received-
(i) engages himself in the practice of accountancy; or
(ii) offers to perform or performs services involving the auditing or other related services (verification
of financial transactions, books, accounts, or records or the preparation, verification or certification of
financial accounting and related statements) or holds himself out to the public as an accountant; or
(iii) renders professional services or assistance in or about matters of principle or detail relating to
accounting procedure or the recording, presentation or certification of financial facts or data; or
(iv) renders such other services as, in the opinion of the Council, are or may be rendered by a
chartered accountant in practice; and the words "to be in practice" with their grammatical variations
and cognate expressions shall be construed accordingly.
INCLUSIONS
Salaried employee of a CA in practice or a firm shall be deemed to be in practice for
the limited purpose of the training of articled clerks
Deemed to be in practice if he in his professional capacity (not in personal or employee
capacity) acts as:
Liquidator, Trustee, Executor, Arbitrator, Receiver, Advisor, Representative of costing,
taxation and financial matters
Takes up appointment made by CG/ SG/ Court/ Any legal authority
Acts as a secretary
CASECouncil
STUDY of the Institute of Chartered Accountants of India vs. Gurvinder
Singh (Delhi High Court)
Date of Judgement/Order : 16.08.2016
Mr. Mohit Gupta claimed that Mr. Gurvinder Singh ,Chartered Accountant
(respondent) sold 100 shares of Aban Lyod Chiles Offshore Ltd. to him in November
1999 but he lodged the transfer deed for transfer of the shares on November 04, 2004.
In the interim period Mr. Gurvinder continued to receive dividends and in July 2004
obtained duplicate share certificates in his name by misrepresenting that the original
share certificates were lost. He complained such an act of Mr. Gurvinder to Disciplinary
Committee of the Institute of Chartered Accountants of India.
The court observed that whether the conduct of Mr. Gurvinder would attract
disciplinary proceedings of ICAI for professional misconduct depend on the capacity in
which Mr. Gurvinder acted so.
 A member of institute in practice would be liable of professional misconduct when
does an act enumerated in Part I of the First Schedule of Chartered Accountant Act,
1949.A member of institute would be deemed to be in practice when, for
remuneration received or to be received the person performs the acts enumerated in
Sec 2(2) of the CA Act,1949.

 in the instant case , the respondent was acting as an individual in his dealings with
the complainant which were purely commercial. While selling the shares held by
him the respondent was not acting as a Chartered Accountant. He was not
discharging any function in relation to his practice as a Chartered Accountant.

 Accordingly, Mr. Gurvinder ‘s conduct was not professional misconduct thereby


won’t attract any disciplinary proceeding under CA Act,1949.

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