Search

The Institute of Chartered Accountants in England and Wales takes an active part in the shaping of European Community legislation pertinent to the accountancy profession through its Business Law Committee. As part of the Institute's Technical Directorate, the Business Law Committee's EC activity is bounded by the kind of legislation that is being proposed or currently discussed in Brussels and the Institute's exertion of restraint in the use of lobbying as a means of introducing legislation based on an attitude that 'no legislation is better than bad legislation.' The Institute's EC activity focuses on legislation that directly affects accountants, indirectly affects accountants but exerts significant effects on accountants' areas of specialization, and legislation that affects accountants as members of the business community. The three routes of communication used by the Institute to influence legislation are discussed.

Auditing standards in the UK do little to eliminate the expectation gap experienced by the users of corporate financial statements, the gap between what statement users believe that auditors do and what they actually do. There are three components of the expectation gap: standards, performance, and liability. The Auditing Practice Committee (APC) should reduce the expectation gap to eliminate false expectations among the users of financial statements. The APC compared its guidance to US guidance on auditing standards concerning the expectation gap and has identified and is seeking to rectify inadequacies in three areas: fraud, illegal acts, and the audit report. In addition to auditing guidance, the APC should emphasize education in order to remedy the poor performance that also contributes to the expectation gap.

The ICAEW's Audit and Assurance Faculty has developed new guidance to help its members who are compiling the accounts of incorporated entities following the changes to the thresholds for statutory audit. It is important for accountants when carrying out a compilation engagement to obtain an understanding of the business and its operations and to consider whether the financial statements are consistent with this understanding.

Presents letters to the editor referencing articles and topics discussed in previous issues. "Radical Critique," which focused on humanist choices; "Rhyme and Reason," which discussed pseudo-medicines; "No Offense Taken," which focused on atheists.

An interview with Ruth Cookie, senior practice nurse and Petone Medical Centre director in Lower Hutt, New Zealand, about the worst thing about her practice, her greatest achievement, and traits she dislikes is presented.