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May 10, 2020 at 11:15 am
Hi i have a doubt, you mentioned that auditors fees is inversely related to the Internal controls of the company so if the internal controls are good, auditors will perform less work therefore less fees. So in a situation where the client and auditors have been working together for a few years, wont the fees substantially decrease as the auditors know the clients internal controls very well hence they will charge less fees because less work is to be conducted?
Kim Smith says
May 10, 2020 at 12:42 pm
No – each year the auditor must confirm that the internal controls have operated throughout the year effectively. The auditor cannot do less work on controls this year simply because controls were effective in previous years. Also systems of controls are not static and will change. It is true that the audit fee in the first year of a new appointment might be higher than it is in the following year because of the additional work required – but not necessarily (e.g. in a competitive tender).
April 18, 2020 at 12:02 pm
A small query that as an auditor acca members are privileged to sign the audit reports or only the icaew members are allowed to do that ??
Thanks in advance
May 10, 2020 at 12:37 pm
Members of ACCA, ICAEW, ICAS and ICAI with PRACTICING CERTIFICATES would all be able to sign auditor’s reports in the UK.
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