Growfast Plc. was formed on 1 August 1990 to manufacture minicomputers. The directors are unsure as to their responsibilities, and the nature of their relationship with the external auditors. The audit partners has asked you to visit the client and explain to the director the main fundamental aspects of the accountability of the company and their relationship with the auditor.

Required:

Write a report explaining to the directors of Growfast Plc.

1. Why there is a need for an audit.
2. How the auditor of a public company may be appointed under the companies Act.
3. What are the auditors right are under the companies Act.
4. The responsibilities of the directors in relation to the accounting function of the company.