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Unit 14: Professional Ethics and Current Issues

E-commerce: E-commerce is a system of conducting business over the internet by electronic Notes
rather than paper-based methods.
Electronic Data Interchange (EDI): In E-commerce, documents such as invoices are exchanged
using a standard method known as Electronic Data Interchange (EDI).
Forensic Accounting: Forensic accounting/auditing can be defined as accounting/auditing skills
to situations that have legal consequences.
International Standard on Auditing (ISA): The International Standard on Auditing (ISA) deals
with the auditor's responsibility to consider laws and regulations in an audit of financial
statements.
Non-compliance: The term "non-compliance" as used refers to acts of omission or commission
by the entity being audited, either intentional or unintentional, which are contrary to the
prevailing laws or regulations.
Secure Electronic Transmission (SET): Secure Electronic Transmission (SET) is an extension of
EDI. Using SET, monies can be transferred primarily through credit card payments. E-commerce
raises various risks for firms applying it and for auditors as well.

14.6 Review Questions

1. Briefly explain about the professional ethics in auditing.
2. What is the term non-compliance with laws and regulation means?
3. What are Auditor’s Duty while considering laws and regulation in an audit of financial
statements?
4. Describe the regulations in auditing
5. What audit procedures are necessary to be applied by the auditor when non-compliance is
identified or suspected?
6. Explain Forensic accounting.
7. What are IT Audit basics?

8. Explain the purpose and elements of IT Audit Basics.
9. What are the current issues in auditing?
10. Write down the matters which influence auditing and give rise to current issues.

Answers: Self Assessment

1. Audit operation 2. Ethical auditing
3. Ethical accounting 4. Non-compliance

5. IFAC 6. International Standard on Auditing (ISA)
7. Material misstatement 8. Statutory auditors
9. Statute laws 10. Political
11. Electronic Data Interchange (EDI) 12. Forensic

13. Forensic accounting/auditing 14. IT
15. Information system

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