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Hello sir.
With respect to money laundering, I know that we have to report to the MLRO. We can’t resign as this may result in tipping off. So ultimately, we have to issue the opinion.
What exactly would be the opinion? there are doubts on integrity of client so matter is pervasive, hence adverse opinion is valid, right?
And if there’s refusal to answer, it’s a disclaimer, yes?For bribery, I believe, we will assess on the materiality of the issue. Like how big the amount of bribe is and its nature and based on that, modify the report.
However, what if there’s no effect of the bribe on the financial statements, then what?
A bribe is a bribe is a bribe! Materiality is hardly relevant. It’s like saying that you’re part pregnant. Or claiming that you could commit quarter of a murder.
Notifying the MLRO should result in pretty much INSTANT response so I don’t think tipping off would become an issue
Agree with your comments, sir.
I have worked out the impact of bribe, please correct me, if I’m wrong. The bribe will be to gain advantage in something, say, concealing a fraud. The auditor should be concerned about the materiality of the fraud and this alone will have an impact on the audit report. The bribe will be reported to the relevant authority.
With respect to your money laundering comments, I understand that once we have informed the MLRO, we are safe to resign from the audit, right? So there’s no need to issue the audit report.
The bribe is more a company matter. The auditor is on the look out for breaches by the company of the Bribery Act. It’s not so much the attempts by the company to bribe the auditor. Rather it’s the attempts by the company to gain advantage by bribing others or to protect the company’s employees from being exposed to bribery
Money laundering? Yes, probably resign unless you can persuade the client to come clean. Then offer to help in confession (and negotiate a separate fee)
If help refused, get on your bike and ride (having made your notification to the relevant authorities)
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