Sarah Page was, until July 2020, a registered auditor in public practice. She was the only registered auditor in her practice but she employed five staff members. During the early part of 2020, she was involved in fraud and as a result was permanently removed from the register of Page 15 of 15 practitioners (registered auditors) by the Independent Regulatory Board for Auditors. Because of this, Sarah Page, in an attempt to retain her practice, entered into an agreement with Grace Dlamini, a registered auditor, whereby she was employed by Grace, was paid a salary by her, and shared profits with her. Grace was fully aware of Sarah’s circumstances. The “partnership” letterhead was revised to read “G Dlamini and Co (in association with Page and Co) - Registered Auditors”. The arrangement was that Sarah would continue to service all her clients but that Grace would sign all reports. 

 

1. Discuss the actions of Grace and Sarah in terms of the Auditing Professional Act 2005.

2. Explain briefly the Auditing Professional Act 2005.