Financial statements audited by a qualified auditor would normally be regarded as being more reliable than unaudited statements. This is because the financial statements users are aware that the auditor possesses expertise and they are also assumed to be independent. Nevertheless, the role of an audit today has been extended beyond the statuatory financial statements audit.

c) Justify your answer whether the people below are suitable to be appointed as an external auditor of IImuan Berhad (IB), a company listed in the Bursa Malaysia. i. A member of ACCA who is currently a chief financial officer in IB. ii. A shareholder owning 10% of the ordinary shares in IB. iii. A member of ICAEW, a partner in a Chartered Accountant (CA) firm. iv. A Japanese director, who is empowered by the Japanese Law to audit public companies in Japan. v. The sales director, whom his wife is a newly appointed Chief Internal Auditor (CIA) in IB. (5 marks) d) Accounting and auditing are sometimes being interchangeable used. Distinguish between accounting and auditing. (5 marks) e) In becoming an auditor, people from other background are welcomed and seen to have joined this profession. However, the industry still observed that more than half of auditors come from the accounting background. Justify this observation