International Finance and Accounting Handbook

(avery) #1

15 • 32


Responsibility for

Country

Ethical Standards

Enforcement

Legal Liability

Detection of Fraud

Africa and Middle EastSaudi Arabia

Ethical standards (which en-

Ministry of Commerce

The auditor is liable for negli-

Responsibility exists only if

compass U.S. GAAS require-

gence. However, civil litiga-

the fraud is material to the

ments) as set by SOCPA

tion against auditors is very

financial statements taken as

rare. The Ministry of

a whole.

Commerce will penalize au-ditors who break regulations.

Kenya

Ethical standards are given in

Section 28 of the

The auditor is legally and

The auditor is not responsible

Statements and in Section 28

Accountants Act (Cap 531 of

professionally liable only

for failure to detect fraud or

of the Accountants Act

the Laws of Kenya)

when he or she fails to apply

illegal acts. However, the

(Cap 531 of the Laws of

or incorrectly applies the

auditor should plan his or her

Kenya). A member of ICPA(K)

required auditing standards.

audit with reasonable expec-

must maintain integrity, pro-

tation of detecting material

fessional independence and

misstatements resulting from

confidentiality, and show

irregularities or fraud.

competence in all profes-sional work.

Exhibit 15.3

(Continued

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