Function

Approved work program for 2008-09

Monitoring and assessing the nature and overall adequacy of the systems and processes used by Australian auditors to ensure compliance with auditor independence requirements.

Information concerning the performance of this function will continue to be provided by ASIC (under the terms of the MOU with the FRC).

In addition, the FRC will monitor the AQRB's work in this area and consult, as necessary, accounting firms that conduct audits of listed entities.

Monitoring and assessing the nature and overall adequacy of:

1. the systems and processes used by professional accounting bodies for planning and performing quality assurance reviews of audit work undertaken by Australian auditors to the extent that those reviews relate to auditor independence requirements;
2. the action that Australian auditors who have been subject to such quality assurance reviews have taken in response to the reports prepared as a result of those reviews; and
3. the action taken by professional accounting bodies to ensure that Australian auditors who have been subject to such quality assurance reviews respond appropriately to the reports prepared as a result of those reviews.

In 2008 09, the FRC will continue to perform this function by reviewing information supplied to the FRC under the terms of its MOU with the professional accounting bodies, obtaining information at periodic meetings with and reviewing publicly available information issued by the professional accounting bodies.

Monitoring and assessing the nature and overall adequacy of the investigation and disciplinary procedures of professional accounting bodies as those procedures apply to Australian auditors.

The FRC's work in respect of this function will continue to be met through the examination of material supplied to the FRC under the terms of the its MOU with the professional accounting bodies, obtaining information at periodic meetings with, and reviewing publicly available information issued by, the professional accounting bodies.

Monitoring the overall compliance by companies, registered schemes and disclosing entities with the audit-related disclosure requirements of the Corporations Act and the accounting standards. (These disclosure requirements are listed in Appendix G.)

As part of its 2008-09 work program, the FRC will review, and analyse, the level of compliance with audit-related disclosure requirements by considering the information provided by the MOU bodies.

Giving the Minister reports and advice about the matters referred to above.

The FRC will continue to provide reports and advice on an as required' basis.

Giving professional accounting bodies reports and advice about matters related to their quality assurance reviews and disciplinary procedures as detailed above.

Monitor developments on an ongoing basis and provide reports and advice on an as required' basis.

Monitoring international developments in auditor independence, assessing the adequacy of the Australian auditor independence requirements provided for in:

1. the Corporations Act; and
2. codes of professional conduct; and

in the light of those developments give the Minister and professional accounting bodies, reports and advice on any additional measures needed to enhance the independence of Australian auditors.

In 2008-09, the FRC will continue to perform this function by:

1. monitoring media reports and information on relevant websites (this information is provided to all FRC members on a monthly basis); and
2. meeting with appropriate bodies in other jurisdictions as part of overseas visits by the FRC chairman and the Secretariat.

Promoting, and monitoring the adequacy of, the teaching of professional and business ethics by, or on behalf of, professional accounting bodies to the extent to which the teaching of those subjects relates to auditor independence.

The FRC's work in respect of this function will flow from the reports of the consultants and the recommendations contained in those reports.

Consultation with the professional accounting bodies, the APESB and relevant stakeholders will be made concerning the implementation of those recommendations accepted by the FRC.

The FRC will seek participation from relevant stakeholders to jointly develop an ethics education campaign'.

Other matters.

1. Issues associated with the provision of non-audit services.

The FRC Secretariat will undertake research on this issue during 2008-09. The FRC will continue to monitor trends in fees received by auditors of audited entities for audit and non-audit services.