The Department of Treasury Audit Quality in Australia: A Strategic View, is available from the website www.treasury.gov.au. The 2009 report was completed on behalf of the Financial Reporting Council (FRC). Access the report and discuss the following:

1. Why is auditor independence important and what do you think is the role of the FRC in this regard?
2. If you were an external consultant for the FRC, identify the audit quality issues highlighted in the review and recommend changes to the audit independence regime.
3. Evaluate the system of how the FRC examines auditor independence.