Proposed Changes to Auditor Independence Rules Essay
Order ID |
53563633773 |
Type |
Essay |
Writer Level |
Masters |
Style |
APA |
Sources/References |
4 |
Perfect Number of Pages to Order |
5-10 Pages |
Description/Paper Instructions
Proposed Changes to Auditor Independence Rules Essay
Proposed, Changes, Auditor, Independence, Rules, Essay
The article accompanying this page appeared recently in the business press and has been selected by Professor Hong for this assessment. Briefly summarize the article and then analyze it by identifying a particular issue raised in the article and examining its implications.
Do not use the exact language of the article in your own writing and be sure attribute any direct quotations correctly. Your response should have a clearly identifiable thesis position and feature well-substantiated claims that would be of interest to an audience of readers of the business press. The summary should take up between one-quarter and one-third of your total response.
SEC Proposes Loosening of Auditor Independence Rules
The U.S. Securities and Exchange Commission on Monday proposed changes to auditor independence rules that would relax regulation of audit firms in cases involving affiliates of their clients and preparations for initial public offerings.
The proposed rule, which has been released for public comment over the next 60 days, represents a potential further loosening of regulation following the June approval of softer rules governing auditors’ and funds’ financial ties to the same lender.
The changes proposed Monday would give auditors more discretion in assessing conflicts of interest in their relationships with companies they audit.
The proposal would alter the definition of affiliates of an audit client, which currently states that the independence rules governing an auditor of a portfolio company also extend to any other portfolio company controlled by the same private fund.
The proposal would build a materiality qualifier into the definition, allowing the auditor to determine if another portfolio company under the fund is material to the fund. If the auditor determines no materiality, it can provide non audit services to that company without compromising its independence.
The different ways auditors assess materiality could lead to variation in analyses.
The Big Four accounting firms’ push into consulting to boost revenues has been the subject of scrutiny in recent years. U.K. regulators, for example, have proposed an operational split between accounting firms’ audit and consulting businesses. A parliamentary committee also suggested new legislation that would introduce a structural separation between audit and consulting businesses.
The SEC proposal would also shorten the period during which U.S. companies planning to go public ensure their auditor’s independence before an IPO. The proposal would change the time frame, known as a “look-back” period, from three years to one year for U.S. companies. Non-U.S. companies are currently subject to a one-year requirement for ensuring their auditor’s independence before an IPO.
The proposal would also expand upon the SEC’s recent loan-related changes to auditing rules. Under the proposal, the student loans of certain employees who are involved in or are in a position to influence an audit would no longer be deemed to compromise the independence of the audit firm.
The current rules apply restrictions to those employees who had obtained student loans from an audit client through normal lending procedures before their employment at the firm.
“The proposal is consistent with the Commission’s long-recognized view that an audit by an objective, impartial, and skilled professional enhances both investor protection and market integrity, and, in turn, facilitates capital formation,” SEC Chairman Jay Clayton said in a statement.
The amendments would increase the number of qualified audit firms a company could choose from and permit audit committees and commission staff to better focus on relationships that could impair an auditor’s objectivity and impartiality, Mr. Clayton said.
Mr. Clayton said in December that changes to auditor independence rules were a priority of the regulator in the next year. He also said the audit committee has an especially important role in evaluating independence. The SEC’s office of the chief accountant provided recommendations on additional changes to the auditor-independence rule to the commission.
The agency previously removed a rule that prevented a firm from auditing a fund while also borrowing money from a lender with a stake above a certain threshold in the same fund. The change replaced the threshold with a squishier form of appraisal known as a “significant influence” test, which seeks to determine whether a beneficial owner or loan relationship may impair the auditor’s independence.
Monday’s proposal covers the potential future changes to auditor independence that were mentioned broadly in the loan amendment document. In the devising of the proposal, the SEC reviewed past comments from audit firms on other changes to existing rules.
The SEC has detected several alleged independence violations in recent years involving large accounting firms.
RUBRIC
QUALITY OF RESPONSE |
NO RESPONSE |
POOR / UNSATISFACTORY |
SATISFACTORY |
GOOD |
EXCELLENT |
Content (worth a maximum of 50% of the total points) |
Zero points: Student failed to submit the final paper. |
20 points out of 50: The essay illustrates poor understanding of the relevant material by failing to address or incorrectly addressing the relevant content; failing to identify or inaccurately explaining/defining key concepts/ideas; ignoring or incorrectly explaining key points/claims and the reasoning behind them; and/or incorrectly or inappropriately using terminology; and elements of the response are lacking. |
30 points out of 50: The essay illustrates a rudimentary understanding of the relevant material by mentioning but not full explaining the relevant content; identifying some of the key concepts/ideas though failing to fully or accurately explain many of them; using terminology, though sometimes inaccurately or inappropriately; and/or incorporating some key claims/points but failing to explain the reasoning behind them or doing so inaccurately. Elements of the required response may also be lacking. |
40 points out of 50: The essay illustrates solid understanding of the relevant material by correctly addressing most of the relevant content; identifying and explaining most of the key concepts/ideas; using correct terminology; explaining the reasoning behind most of the key points/claims; and/or where necessary or useful, substantiating some points with accurate examples. The answer is complete. |
50 points: The essay illustrates exemplary understanding of the relevant material by thoroughly and correctly addressing the relevant content; identifying and explaining all of the key concepts/ideas; using correct terminology explaining the reasoning behind key points/claims and substantiating, as necessary/useful, points with several accurate and illuminating examples. No aspects of the required answer are missing. |
Use of Sources (worth a maximum of 20% of the total points). |
Zero points: Student failed to include citations and/or references. Or the student failed to submit a final paper. |
5 out 20 points: Sources are seldom cited to support statements and/or format of citations are not recognizable as APA 6th Edition format. There are major errors in the formation of the references and citations. And/or there is a major reliance on highly questionable. The Student fails to provide an adequate synthesis of research collected for the paper. |
10 out 20 points: References to scholarly sources are occasionally given; many statements seem unsubstantiated. Frequent errors in APA 6th Edition format, leaving the reader confused about the source of the information. There are significant errors of the formation in the references and citations. And/or there is a significant use of highly questionable sources. |
15 out 20 points: Credible Scholarly sources are used effectively support claims and are, for the most part, clear and fairly represented. APA 6th Edition is used with only a few minor errors. There are minor errors in reference and/or citations. And/or there is some use of questionable sources. |
20 points: Credible scholarly sources are used to give compelling evidence to support claims and are clearly and fairly represented. APA 6th Edition format is used accurately and consistently. The student uses above the maximum required references in the development of the assignment. |
Grammar (worth maximum of 20% of total points) |
Zero points: Student failed to submit the final paper. |
5 points out of 20: The paper does not communicate ideas/points clearly due to inappropriate use of terminology and vague language; thoughts and sentences are disjointed or incomprehensible; organization lacking; and/or numerous grammatical, spelling/punctuation errors |
10 points out 20: The paper is often unclear and difficult to follow due to some inappropriate terminology and/or vague language; ideas may be fragmented, wandering and/or repetitive; poor organization; and/or some grammatical, spelling, punctuation errors |
15 points out of 20: The paper is mostly clear as a result of appropriate use of terminology and minimal vagueness; no tangents and no repetition; fairly good organization; almost perfect grammar, spelling, punctuation, and word usage. |
20 points: The paper is clear, concise, and a pleasure to read as a result of appropriate and precise use of terminology; total coherence of thoughts and presentation and logical organization; and the essay is error free. |
Structure of the Paper (worth 10% of total points) |
Zero points: Student failed to submit the final paper. |
3 points out of 10: Student needs to develop better formatting skills. The paper omits significant structural elements required for and APA 6th edition paper. Formatting of the paper has major flaws. The paper does not conform to APA 6th edition requirements whatsoever. |
5 points out of 10: Appearance of final paper demonstrates the student’s limited ability to format the paper. There are significant errors in formatting and/or the total omission of major components of an APA 6th edition paper. They can include the omission of the cover page, abstract, and page numbers. Additionally the page has major formatting issues with spacing or paragraph formation. Font size might not conform to size requirements. The student also significantly writes too large or too short of and paper |
7 points out of 10: Research paper presents an above-average use of formatting skills. The paper has slight errors within the paper. This can include small errors or omissions with the cover page, abstract, page number, and headers. There could be also slight formatting issues with the document spacing or the font Additionally the paper might slightly exceed or undershoot the specific number of required written pages for the assignment. |
10 points: Student provides a high-caliber, formatted paper. This includes an APA 6th edition cover page, abstract, page number, headers and is double spaced in 12’ Times Roman Font. Additionally, the paper conforms to the specific number of required written pages and neither goes over or under the specified length of the paper. |
|
|
GET THIS PROJECT NOW BY CLICKING ON THIS LINK TO PLACE THE ORDER
Also, you can place the order at www.collegepaper.us/orders/ordernow / www.phdwriters.us/orders/ordernow
|
Do You Have Any Other Essay/Assignment/Class Project/Homework Related to this? Click Here Now [CLICK ME]and Have It Done by Our PhD Qualified Writers!! |
|
|
PLACE THE ORDER WITH US TODAY AND GET A PERFECT SCORE!!!