Audit and Assurance Coursework 2018/19 MAIN - BAC & SHU
Quis Custodiet Ipsos Custodes?
Juvenal Plc is a large UK Company with over 3000 employees, and international trading operations.
Bob is an expert in Human Resource Management and, as a Non-Executive Director of Juvenal Plc,
he has recently been seconded to its newly formed Audit Committee. Bob was persuaded to take
on the role, as no one else wanted to do it, but by his own admission he doesn’t know much about
external audit, or the role of the audit committee. After accepting the Audit Committee role, Bob
discussed his concerns with his friend Alice.
Bob: Juvenal Plc have created an Audit Committee because the external auditors said it was a good
idea, but I don't really know how the company will benefit from the work it will do.
Alice: Who is on the Audit Committee with you?
Bob: It's just me and Steve, the Director of Finance. I assume that's enough in terms of independence,
numbers and expertise for the committee to be effective, but I really do not know.
Alice: It must be a good thing or your auditors wouldn't recommend it.
Bob: I suppose so, but I'm not really sure we can rely on the auditors. They come in and tell us what
to do, but who ensures the quality of their work?
Alice: Maybe that's what the Audit Committee is supposed to do!
Bob: Well yes, someone should keep an eye on them! There was another report in the news this
week, about an audit firm that was fined for not carrying out an effective audit, on the financial
statements of a UK Plc. Apparently, the audit firm was severely reprimanded and warned about its
conduct on future audit engagements .
Alice: There you go then, someone must be keeping an eye on the auditors if they are being fined.
Bob: I know, but I’m still unsure as to how much value the Audit Committee is going to add to
Juvenal’s day-to-day operations, and whether it should bother about having one.
Required:
Critically discuss the comments above. As a minimum your submission should contain analysis of
each of the following:
The function, benefits and membership of the Audit Committee
The regulation and oversight in place to ensure audit firms carry out work of a sufficiently
high quality
The role that the Audit Committee should play in ensuring that auditors carry out their work
effectively
You should use real life examples to support and illustrate the points made in your narrative. These
may include cases where an auditor or audit firm was fined for carrying out unsatisfactory audit
work, and examples from quality reviews of the audit firms carried out by the relevant regulatory
Audit and Assurance Coursework 2018/19 MAIN - BAC & SHU
body. You should also use existing research to support your arguments. Finally make sure you
address the final point made by Bob.
Word count: 1,900 to 2,100 words
(Submission electronically via Blackboard and via TurnItIn)
Fail Pass 2:2 2:1 First
<40% 40-49% 50-59% 60-69% 70%
Mainly descriptive Tendency to be Sound analysis of Critical and reasoned Perceptive and
approach with no descriptive with issues and analysis of issues and insightful analysis of
discussion limited discussion of implications implications issues and
issues
implications
Limited issues Some issues Identification of Identification of key Identification of key
identified with no or identified with some key issues with issues with good and potential issues
little knowledge of limited knowledge of clear knowledge of knowledge of topic with excellent
topic topic
topic understanding of
topic
Absence of or very Weak use of Sound literature Critical use and Perceptive use and
poor literature literature review with an consideration of critique of literature
review appropriate listing of literature with a good with an excellent
listing of sources and
sources and listing of sources and
references
references references
Absence of Some attempt to Competent attempt Critical and reasoned Perceptive and
concluding conclude to conclude conclusion insightful conclusions
commentary
No or poor practical Limited practical Competent attempt Reasoned application Insightful application
application to application to to relate to situation to situation to situation
situation situation
Applies key skills and Applies all skills and
Applies some key knowledge knowledge
Inappropriate or Applies some key
insufficient skills and knowledge skills and knowledge appropriately appropriately
application of but not necessarily in appropriately
appropriate skills and an entirely
knowledge appropriate manner