Wednesday, July 31, 2019

Samson in the Bible

Samson’s life was filled with adventure as God blessed him and gave him strength to become one of the judges of Israel. Yet, he squandered all of his potentials and abdicated his responsibilities as a judge of Israel because he became proud of his strength and disobeyed God. Samson’s parents came from the tribe of Dan in Israel. Although his mother was sterile, she conceived Samson as a result of direct intervention from God. Even at a young age, the spirit of God was already evident in the life of Samson. This happened at a time when the Israelites were not following the statutes and the decrees of God. Samson was to become one of the leaders of the people and deliver them from oppression of foreigners. God gave Samson immense strength. While he was on the road one day, he encountered a lion, which he killed with his bare hands. Such was his strength that his potentials were definitely from God. Yet, Samson had one fatal flaw – his weakness for women. Because of women, he disobeyed the will of his parents and eventually was led away from his calling as a judge of Israel. The first occasion when he displayed this weakness was when he saw a Philistine woman and became obsessed with her. He engaged into a riddle with a hefty sum of properties as prize with the men of Ashkelon. The men, however, coaxed his wife to reveal the answer to them. Because Samson was so angry, he killed a lot of the men in that place. When he also learned that his wife was given to another man, he wrought havoc against the fields of the Philistines. As a result, the Philistines came against him. As a result, he set a trap for them. He allowed himself to be bound. But later on, he managed to get away from the rope and kill the men who went against him. His victory against the Philistines was brought about by God. Samson even saw a source of water when he was already very thirsty. After the incident with the Philistines, he became enamored with a prostitute and the men of the town decided to trap him in that place. Yet, his great strength aided him against their trap and managed to get away from them. The turning point in Samson’s life was his love affair with Delilah. Little did he know that Delilah was being used by his enemies all over again. He did not learn from his previous experiences and instead allowed his emotions and passions to cloud his wits. Not even once did he suspect Delilah to be the spy of his enemies. So great was his obsession for Delilah that he revealed the secret of his strength with her after several prodding. The end result was his imprisonment and being cut off from his family and his country. During his imprisonment, Samson called out to God during his distress and asked Him to bless him with strength although his hair was no longer long. God granted his request and for a final time, Samson brought havoc and destruction to the enemies of his people. Samson knew his calling as a judge. As a man, he was always aggressive and on the lookout for the next beauty to pursue. Perhaps, the reason why he behaved the way he did is that he was looking for adventure and he thought he will find it in the arms of the women that he loved. Perhaps he fell easily in love and after that, he became blinded to that love. A lot of people are just like Samson. They have great potentials and strength. They know that they are called to do good for God and their people. Yet, they choose to go their own way, choose their own paths that eventually lead to destruction. When people start doing as Samson did, they become blinded to whatever it is that they fall in love with—money, fame, power, other people—and forget about their mission in life. The end result is disaster and ensnarement with the effects and consequences of such choices. Some author may have considered Samson as a sociopath with anti-social personality disorder. This may seem to account for his aggressive behavior, his deceit, impulsiveness and even violence. Although this analysis may seem scientific and related to psychology, but Samson’s personality and impulses is similar to what most individuals encounter. Samson was aware of God’s calling in his life and he even calls out to God when he is deeply in need. Yet, like most men, he has lust for women and he is doing what he can to impress them and win them over. Likewise, he tends to be boastful and arrogant of the strength that he has, a trait which a lot of men display. Another possible reason why he engaged in his acts was loneliness. Calling that â€Å"antisocial† might seem more scientific. Yet, men who experience loneliness may try prostitution and other act just to get over with it. The bottom line is that Samson is an individual who was given immense strength and the potential to lead his people and overthrow the oppressors of his nation. Yet, because of his obsession with women, his lust, his aggressiveness and impulsiveness, he did not fulfill the role prepared for him. Individuals all over the world display just the same kind of attitudes and recklessness. The end result of such attitude and actions is an array of consequences and difficult circumstances. From Samson, individuals may learn that pursuing one’s passions and obsessions lead to harm.

Tuesday, July 30, 2019

Christianity and mathematics Essay

This paper deals with interrelation between Christianity and mathematics. It has been observed that God is the creator of this universe and He is also the creator of our various mathematical formulae and deductions. Like Universe and God, they are also eternal and cannot be ever destroyed. The paper has also described how Christianity has described the relation between God and our numeric system, which is the basic foundation of Mathematics. Christianity and mathematics 3 Link between Christianity and mathematics – philosophical aspect Let us consider the formulae for earth’s mass distribution, orbital path of celestial bodies and population fluctuation. They are simple mathematical formulae that describe the creation of this universe and humanity. According to Christianity, who is the creator of this Earth? It is none than the God himself. Jonathan Zderad (2003) has stated in the article written in the website http://www. acmsonline. org/Zderad-creationism. pdf that universe, that is the creation of God is hardwired by the laws of mathematics. If one have a look at the theorems of mathematics, it seemed that they were true before time began and will continue to be true after time lapses. Jonathan has mentioned this in his article in the above mentioned website. Mathematics exists beyond human thought and logic. Christianity believes that only God can create such things which are eternal and divine. Jonathan (2003) has mentioned in his article that mathematics existed beyond time and space. According to Christianity, only God, the supreme power behind this human existence can exist beyond time and space. It is very much clear from the Biblical records that god gives value to numbers. To quote from the above mentioned website, â€Å"For Christians, God’s counting is what gives the believer a place in heaven. Jesus compared himself to a shepherd who leaves the ninety-nine sheep to rescue one sheep that is lost. He values each and every one of us. † (p. 6). Jonathan Zderad (2003). The Holy Bible has drawn many references from the numeric system of mathematics. How Christianity is linked to basic numeric system of mathematics Jonathan (2003) has also described in the above mentioned article how Christianity is Christianity and mathematics 4 related to our numeric system. The author has described that while the Number represents unity, number 2 is the symbol of fellowship and number 3 representing the community. The author states that these numbers represent spiritual qualities. The author has stated in the article that Bible has enough indications that it is God who has created the series of integers, rational and irrational numbers and real numbers. Jonathan has argued in the article that Bible has strong reference to the concept of counting. Numbers were generally used to describe dimension while building a place of worship. How Creation of God is linked with creation of mathematics The author has also suggested in the above article that there is a clear view of Christian view of Mathematics, which is described as creationism. Creationism has got four aspects. The first one is continuity. God makes his own creation in such a way that it is continuous. The second aspect is activity. The author has stated that he has created all these mathematical entities out of his own mental divine activities. The third one has been described as the abstract object inclusive. To quote, â€Å"As a general rule, theists would include mental objects and spiritual objects in the list of God’s invisible creation. Creationism also includes abstract objects like propositions, relations, and universals in this list of God’s invisible creation†. (p7). Jonathan Zderad (2003). The fourth one is that it is mathematically inclusive. It believes that Mathematical objects are created by God and they have an eternal quality, which can only proceed from the mind of God. Christianity and mathematics 5 Reference Zderad, Jonathan. (2003) Creationism – A Viable Philosophy of Mathematics. www. acms. org. Retrieved on 15th December, 2008, from http://www. acmsonline. org/Zderad-creationism. pdf

Nefertiti: Queen of Egypt

Today, Nefertiti is one of the most well known queens of Egypt, famed throughout the ancient world for her beauty. There is little known about the background of Nefertiti but many believe that she was not of royal bloodline. Her father was believed to be a high official of Amenhotep III and Akhenaten. It is said that Nefertiti was chosen by her Father and her Aunt, the Pharaoh’s mother, because of her strong personality that it was believed she could reign in the Pharaoh so her family would hold the real power behind the throne. She was not rivaled only by her power but also by her beauty. Her face has become one of the most recognizable images in the world since the founding of her bust in 1912. She was an independent woman and thinker centuries before her time (Fletcher, 2004). But the question that many people wonder is â€Å"Who was Queen Nefertiti and how much power did she have? † Nefertiti first rose to prominence in Egyptology in 1912, when a three-thousand-year-old bust of the queen was unearthed and quickly became a recognizable artifact around the world. But pieces of Nefertiti's life remained missing (Fletcher, 2004). The beginning of her existence starts with her breaking through the sex barrier to rule as a co-Pharaoh alongside her husband, Akhenaten. Nefertiti parents are not known and she was probably of non-royal birth, most historians say. Most believe she was 12 years old when she became queen and that Amenhotep IV was around the same age (Englar, 2009). Nefertiti married Amenhotep IV who took the name â€Å"Akhenaten†, who ruled over Egypt for approximately 17 years during the 18th Dynasty around 1357 B. C. E. She had six daughters but no sons with Akhenaten, who also had other wives. But neither of them were carved into the sculptures except Nefertiti, so many people believed he loved her most. She appeared with her husband Akhenaten on all major monuments. She even assisted in offerings. There has been no other queen who appears so frequently in Egyptian history as Queen Nefertiti. Many images of her show simple family gatherings with her husband and daughters. She is also known as the mother-in-law and stepmother of the Pharaoh Tutankhamen. Nefertiti and her husband defied ancient custom by practicing monotheism and by elevating Nefertiti far above the role of subservient consort previously played by Egyptian queens (Tyldesley, 1999). Upon her fourth year of being queen, she left the capital of Thebes where a new city to honor their chosen god, Aten was built. He believed that the Aten, a minor sun god, was the most important god so Nefertiti being his wife followed suit. The religion in the country was then transformed so their new god, Aten, may be held up above all others. Neferitti and her husband designed the new city and more than 50,000 Egyptians moved to Akhenaten to serve the king and queen in their new city. This is the first time that Egyptian religion accepted one god rather than many gods. Nefertiti’s new religious duties gave her more power than most previous Egyptian queens. Nefertiti was perhaps the most influential person on Akhenaten, at that time one of the most powerful rulers on earth. Many people do not know that Nefertiti and her husband changed their names to honor their God. Nefertiti meaning â€Å"the beautiful woman† had come to be known as Neferneferuaten which means â€Å"beautiful are the beauties of Aten. † The reason for this change is so â€Å"Aten† would be included in her new name to honor their god. During the Amarna period, Nefertiti was seen as almost equal to a Pharaoh. Nefertiti soon became enamored with her new found power and her popularity with the people and is somewhat swept up along with her husband in his dreams of glamour, power, and immortality (Moran, 2007). Upon his death she took control of Aten. The Egyptian people loved her and celebrated her beauty in art, but the priests did not feel the same way. Historians say that priests who, upon Nefertiti's death, had her name erased from all public records. This led to her being left out of history for over three thousand years. Very little is known of Nefertiti, her death is not recorded, and her tomb has not been found. Her beauty is renowned from the masks found at Amarna by archaeologists early in this century, having been lost for millennia. It is unusual that a queen like Nefertiti, death would not be recorded in the culture of Egypt. Even to this day monuments to those who ruled and played a major part in Egypt have pyramids and tombs bestowing their importance. It is very sad that Akhenaten and Nefertiti's family was all but destroyed. Three thousand years after her death, Nefertiti’s beauty still captivates thousands of visitors each year. It was her mysterious smile and powerful gaze that attracted many men to her making them wonder who she had been and how she’d become a dominant figure in ancient Egypt. However, tragedy eventually calls, and everything Nefertiti worked so hard to achieve hangs in the balance (Englar 2009). Some historians believe she died from a plague or even ruled Egypt under a new name, Smenkhkare. Yet there has, over time, been a great deal of controversy on all these facts. It would seem that Smenkhkare became co-regent shortly after the death of Akhenaten’s principle wife, Nefertiti. Speculation at times have run rampant, including one theory that Nefertiti herself had actually disguised herself as a male in the custom of Hatshepsut, becoming co-regent (Dunn, 2003). Nefertiti will always hold a mysterious history, her remains and the location of her body has long been a subject of curiosity and speculation. Her place as an icon in popular culture is secure and she has become somewhat of a celebrity due to the rare find of her bust. After Cleopatra, she is the second most famous queen of Egypt in the Western imagination and her image has influenced, through photographs, and changed standards of feminine beauty of the twentieth century, and is often referred to as â€Å"the most beautiful woman in the world† (Dunn, 2003). Her most important legacy, though, may be that she and Pharaoh Akhenaten tried to establish a monotheistic religion in Egypt, which, if it had survived, would have created a very different history for the Middle East, with important ramifications for the current religious/political turmoil of the area (Weller, 2008). She will always be held as one of the most influential and most powerful queens to ever rule Egypt. References Dunn, Jimmy. (2003). Smenkhkare: An obscure pharaoh of the 18th dynasty. Retrieved from ttps://ww. touregypt. net/featurestories/smenkhakare. htm Englar, Mary. (2009). Nefertiti of Egypt. Capstone Publishing Company. Fletcher, Joann. (2004). Search for Nefertiti: The true story of an amazing discovery. Harper Collins Publishers. Moran, Michelle. (2007). Nefertiti. New York: Crown Pub. Tyldesley, Joyce A. (1999). Nefertiti: Egypt’s sun queen. Viking Adult. Weller, Doug. (2008). Nefertiti. New world encyclopedia. Retrieved (2010, February 25) from http://ww w. newworldencyclopedia. org

Monday, July 29, 2019

Critically evaluate the extent to which the change process in Essay

Critically evaluate the extent to which the change process in organisations is influenced by the attitudes and beliefs of individual managers more than the dynamics within the group - Essay Example The success of ant change program determines the success of the management as change has become one of the major challenges facing human resource managers and employees in equal measures. Changes in an organization are known to affect the people in such organizations positively or negatively depending on the position of an individual in the leadership hierarchy2. Resistance to change has become part of any organization and this explains the multiple academic researchers conducted to evaluate the impacts of resistance on the success of an organization. For an organization to successfully change from its traditional approach to a new one based on market needs, a number of factors must be visible within the organization3. Their attitude and belief in the change being implemented impacts to a lager extent on the success on the plan as opposed to the dynamism of the organization and its structural willingness to adapt to new methods of conducting business. In this paper, the level by which the attitude and belief of managers and top leaders of an organization influence the change program will be evaluated relative to the impact of the dynamism of the organization to the same. Attitude is defined as the feeling and perception that an individual develops towards a particular event or process which affects their ability to adopt a given program or idea. The attitude of managers on change impact on the change program in a similar or in a greater manner on the change process in an organization and such an attitude is easily passed to the employees that these managers are tasked to supervise. Within the psychological discourse, attitude has been shown to influence the tendency of an individual to act, feel, reason and even respond to a particular stimuli in life4. Attitude thus affects the cognition of an individual towards changes in an

Sunday, July 28, 2019

Legal Systems Assignment Example | Topics and Well Written Essays - 1750 words

Legal Systems - Assignment Example On March 22, 2005 six men were acquitted from a fraud case costing 60 million. Considered to be one of Britain's longest and costliest fraud trials, it just collapsed after twenty-one months of court proceedings at London's Old Bailey.2 The jury's inability to come up with a fair verdict was pointed out to be the reason for such failure. There had been disruptions and problems with the selected jury and further allegations regarding an unfair trial rose. The verdict cause the public to not to remain in silence that caused unrest among the government. This situation led to the Attorney general to impose on the Criminal Act of 2003 regarding fraud trials that put the juries out of the scene. 4 There had been protests even when it was proposed by the Attorney General Lord Lord Goldsmith. However, the pressure to remove juries from the most difficult cases dates back to the Roskill committee on fraud trials, which recommended trial by a judge with expert lay assessors in 1986.5 The implementation of Part 7 of the Criminal Justice Act of 2003 seemed to be the most appropriate practice in complex fraud trials as what happened in the Jubilee line trial. The Government is no longer willing to lose millions of money spent on a single trial thus a trial without a jury is an alternative. The parliament's approval on the said proposition was justifiable through certain aspects that may seem unreasonable for some conservative groups who are not able to see the real deal behind the fraud trials with a judge-only trial. Further explanations regarding this provision were explained in the Explanatory Memorandum to the Criminal Justice Act 2003 (Commencement No. 12 and Transitory Provisions) Order 005. The following are some of the details regarding its implementation. The Government considers that there are certain fraud cases where the length or complexity of the trial is likely to be so burdensome to the jury that it is in the interests of justice that the trial be conducted without a jury by a judge sitting alone. Provisions in Part 7 of the Criminal Justice Act 2003 give effect to this policy and provide for prosecution applications for certain fraud cases to be conducted without a jury. The requirement that the provisions apply only to cases where a notice has been given under section 51B of the Crime and Disorder Act 1998 limits them to cases of serious or complex fraud.6 The provisions operate only where an application is made by the prosecution, the judge is satisfied that the length or complexity of the trial is likely to make it so burdensome upon the jury that the interests of justice require a non jury trial, and the Lord Chief Justice or a judge nominated by him gives his approval.7 It is the Minister's view that the provisions in Part 7 of the Criminal Justice Act 2003 for non jury trials for certain fraud cases are compatible with Convention Rights, as Article 6 of the Convention (right to a fair trial) does not include a right to trial by jury. The Joint Committee on Human Rights commented (Second Report: Criminal Justice Bill, paragraph 5) -

Saturday, July 27, 2019

Impact and influence of The Harlem Renaissance Research Paper

Impact and influence of The Harlem Renaissance - Research Paper Example They helped each other in coming up with better ways of living to benefit their way of living to better standards. The Harlem Renaissance was a culture that cropped up in the early 1920’s and 1930’s, centered in Harlem neighborhood of New York City (Rampersad 2002, p 48). The group had many French speaking black writers from the African continent and some hailed from the Caribbean colonies. The black people had a considerable huge influence to the composition and recording of the music that was connected to the Harlem renaissance in the hood. At a point in time, the Harlem renaissance was also recognized as ‘new negro movement’ named after an anthology by Alain Locke. He was very influential and responsible for the smooth running of the association that made him be rewarded posthumously (Huggins 2007, p 37). There are plausible of the Harlem renaissance have lived longer after and extended its influence to today’s life especially in the music industr y. Previously, the crew had been involved in theatre plays that revealed utter opportunities that the people could use in expressing themselves in complex human emotions and characters. The plays were initiated majorly to give an outward and influential reasoning to the whole world to reduce the highly incumbent stereotype nature against the blacks and Negros. The Harlem renaissance went ahead to write poems that were especially linked to the way of life in the contemporary world that linked the behavior of Negros and their way of life in America. The African Americans developed a notion that they should help each other as they had been suffering for lots of years in slavery and forced labour. This idea made them look out for ways of deluding from the negativities in the society by discovering and enhancing their talents. Many people were talented in different aspects in their living and had to come up with ways of nurturing talent in different ways as long as it could better their living standards. This idea was psyched up by developers selling the Harlem rentals to many black people (New York times 1997, p. 931). Black people started owning real estates and in turn rented exclusively to fellow black people. They developed institutions and businesses to support themselves in their living. This in turn would develop their arrays of talents and ambitions, as they would use their interactions to increase their productivity in the music sector. The advocate of Harlem renaissance for racial equality created an advanced epicenter for their celebrity and became widely known in the whole region as it was among the largest known civil rights group in their headquarters. The movement discussed the problems facing the black community and in collaboration with prominent African American activists developed ways to face their challenges. Impacts of Harlem renaissance First of all, the Harlem renaissance helped in establishing a sense of community and empowerment for Afric an Americans in New York and extended to other parts of the United States. The group created avenues of exposing the African Americans to people in the region who had a vast experience in the different aspects and walks of life. The group transformed the largely segregated and racial American community and influenced meetings of black people with the white’

Friday, July 26, 2019

Financial theories Research Paper Example | Topics and Well Written Essays - 500 words

Financial theories - Research Paper Example This theory applied to establish the expected rate of return on investments to pricing models of modern assets. Some of the attributes include the support of what information can be supportive for strategic investment (Shankman, 1999). Agency theory aimed at the ever-present relationship of agency, in which delegation of work takes place from one person to another, usually the principal and agent. The agency theory deals with the agency clashes, between principals and agents (Bamberg & Spremann, 1987). This theory has certain attributes which includes: (1) ambiguity in routine conclusions, (2) unfavorable choice, and (3) nature of work performed (Bamberg & Spremann, 1987). Agency Costs of free-cash-flow occur between stockholders and managers’ conflict. These conflict arises where a firms with large cash flows than positive investment forecast. The attributes are: (1) agency costs of free cash flow’s reduction benefit in debts and (2) substitution of debt against dividends (Bowie & Freeman, 1992). Theory of Capital Structure provides the companies to organize their financial sources from internal to equity financing. Capital raising sources includes equity or debt, to equity is treated as less preferred means of raising capital. Firms usually, large firms raise their debts to support the dividend’s payment while small firms cut their debts to disburse dividend (Myers & Nicholas, 1984). â€Å"Economic Value Added Theory† (EVA) is a technique of financial performance to compute the profit of a firm. Coca-Cola and General Motors are good examples of this theory. The attributes of this theory includes: (1) maximization of the wealth of shareholders, and (2) investors expectation of company’s growth in future profits against the cost of capital (Hayne, 1998). â€Å"Weighted average cost of Capital is the rate of return, sometimes called discount rate† (Shankman, 1999). This applied in assessing weather the project is viable or not in the

Thursday, July 25, 2019

Capital Punishment - Pro and Contra Research Paper

Capital Punishment - Pro and Contra - Research Paper Example Capital punishment is of very old origin. The word capital is derived from the old Latin word ‘caput’, meaning head. Capital punishment, therefore, refers to beheading or decapitation as a method of execution. Today, the term ‘death penalty’ is used interchangeably with the term capital punishment. Capital punishment originated in England, it was then transported to colonies in America during the 17th and 18th centuries. The English legal system considerably relied on capital punishment; this was partly because imprisonment of people for different periods of time was not developed until the late 18th century. For about four centuries, capital punishment has been practiced in America has been a basic part of its history. The first execution in the United States took place in James town in 1608. Latzer and McCord point out that it has accounted for â€Å"at best estimate, about 20,000 executions† (2011, p.1).   However, the method of execution has undergone remarkable changes over time. In the 17th and 18th century America, men, women, and children would attend a public and solemn occasion where death was imposed by hanging. Execution in public was aimed at frightening members of the public in order to avoid crime, administering justice to the accused, and giving the convicted a chance to repent and gain salvation after death. Hymn singing, sermons, and a speech by the condemned accompanied hanging. During the 17th and 18th century, the number of capital crimes was very big. However, there was a great deal of leniency although most trials took less than a day and appeals were not permitted until the 19th century. A benefit of clergy was sometimes granted to the accused resulting in the pardon of certain death sentences. State governors sometimes granted executive clemency to the accused. For example, in New York City, over half of the condemned were granted clemency. According to Latzer and McCord (2011) â€Å"there were even ‘mock hangings’ to empathetically deliver the message, but spare the life of the offender† (p.2).

Wednesday, July 24, 2019

Global Financial Crisis in Context Essay Example | Topics and Well Written Essays - 1500 words

Global Financial Crisis in Context - Essay Example There is the general consensus across the globe that the 2007-2010 global financial crisis (GFC) is the worst to have hit the world economies ever since the famous Great Depression during the 1030s. To some this crisis has grown to be known as the Great Recession of the time. One of the notable effects of the recent global financial crisis was brought to the fore in terms of failure by the world’s key businesses, significant decline in the wealth among consumers, as well as massive financial commitments by the various governments. In the overall, the aforementioned effects culminated into significant reduction in the economic activities amongst nations. The said financial crisis has its cradle in the bursting of America’s housing bubble. In particular, this housing bubble experienced its peak during the 2005- 2006 period. Immediately afterwards, there was a general increase in the Adjustable Rate Mortgages (ARM) and subprime default rates. As it is put forward by Taylor and Akila, (2009), a resultant increase in incentives of loans for example, simple easy terms as well as long-term trend of increasing prices of housing. As a result, borrowers had been motivated to take difficult mortgages with the hope of being able to quickly refinance them at favorable terms. However, with the increasing interest rates, prices of housing began to drop although moderately during the 2006-2007 period in several parts of the United States of America. Consequently, refinancing became much more difficult. This provided the much needed impetus to the increase in foreclosures and defaults due to the expiry of the simple initial terms.

London Ambulance Service Essay Example | Topics and Well Written Essays - 1500 words

London Ambulance Service - Essay Example There are seventy ambulances, which serves the entire region of London. The trust is under the jurisdiction of the NHS. The NHS board meets after a period of two months to deliberate on the way forward for the trust. The board consists of a non-executive chairperson, five executive directors, and seven non-executive directors making thirteen board members. The LAS has a long history that dates way back in the 1960’s. The trust has weathered hard times to become one of the most reputable ambulance services in the world. Its formation was facilitated by the 1946 National Health services Act, which provided that ambulances were to be availed to any individual that required their services. Nine ambulance services merged in London and formed the LAS in 1965. Adjustments were made by the NHS, which resulted to the moving of LAS from the Local Government to South West Thames Regional Health Authority. It would later become a NHS trust in 1996 when the authority of South West Thames Regional Health Authority was eliminated (London Ambulance Service 2014). The operations of LAS cover a distance of up to 620 square miles. The region of operation ranges from Enfield to the north to Purley to the south while on the western is Heathrow and Upminster to the east. Seventy ambulance stations are spread across the entire region with four main headquarters at Waterloo road, Pocock Street, Loman street, Fielden House, and Bow. The trust provides an array of medical emergencies, which includes; provision of emergency responses, response to less serious calls, providing a clean environment for patient service, they do take patients for hospital appointments, they deal with major incidences, they help in finding hospital beds while making the experience of the patient to count. The services provided by London Ambulance Services stands out as a merit good. A merit good is one that the market underprovides and the forces therein do not affect the

Tuesday, July 23, 2019

Discussion board Assignment Example | Topics and Well Written Essays - 500 words - 1

Discussion board - Assignment Example Serving the poor is an ethical issue and should be done by everyone as response to humanity. A major and most tragic manifestation of poverty is hunger as described by Mohammad Yunus in his book Banker to the Poor. In 1974, famine struck Bangladesh and Yunus wrote about his experiences of witnessing agricultural lands left uncultivated due to lack of irrigation technological awareness among the villagers. He described the scenario in Bangladesh as hungry people multiplied every day, â€Å"Hungry people were everywhere. Often they sat so still that one could not be sure whether they were alive or dead† (Yunus, vii). Yunus nurtured the dream of eradicating poverty from the world. He has taken a bold initiative to help the poor people in Bangladesh. At first he physically stepped onto the fields to show the farmers how to cultivate rice to optimize yields. Although his hands-on approach received skepticism, his next step was the launching of Chittagong University Rural Development Project which provided the poor people academic credit. In order to do more for the poor, he next focused on providing small loans to the very poor to buy raw materials. Initially he became personal guarantor to Janata Bank which is one of the largest government banks in Bangladesh. From this concept, Grameen Bank evolved that provides un-collateral loans to the poor. He encourages repayment of the loans on weekly and even daily basis to prevent accumulation of large debts. Yunus’s efforts have proved to be fruitful and he dreams of a poverty free world by 2050, â€Å"poverty does not belong in a civilized human society. Its proper place is in a museum† (Yunus, 248). There are ways in which people can move towards fulfilling the mission of making this world free of poverty, and the process lies in desire among all people to do something for the poor. Rich countries often provide financial resources to the poor countries, but this is not

Monday, July 22, 2019

Fraud Cases Essay Example for Free

Fraud Cases Essay Tan Sri Eric Chia Eng Hock or commonly known as Eric Chia is a millionaire in Malaysia ad is a former chairmain of Perwaja Steel. In June 2007, Chia discharge committing criminal breach of trust 13 years ago when embezzling money from the company of Perwaja Rolling Mail and Development Sdn Bhd of RM $76. 4 million at 19 February 1994 when was the Managing Director. In his cases, Perwaja Rolling Mill and Development Sdn Bhd in Kuala Lumpur instructed American Express Bank Limited to transfer and credit 2,890,130,210 yen (RM76. million) into Frilsham Enterprise Incorporateds account. Yvonne Lam Yuen Shan, an operations support and control manager of the bank, said she also corrected Frilsham Enterprises account number from 953601855 to 9530018552. Lam, has agreed that the amount stated was actually credited into another bank account (account number 547003027) of Frilsham Enterprise. The 2,890,130,210 yen was the specific sum of payment under the technical assistance agreement, minus the bank charges. The original payment amounted to 2,891,580,000 yen. Asked why the money was transferred to the second account instead of the earlier account, Lam said: We got confirmation from the customer that they would like the amount to be transferred into the second account. We executed the clients request to credit into the account. Chia is accused of dishonestly authorising payment for the amount to the account of Frilsham Enterprise Incorporated with American Express Bank Ltd, Hongkong, for technical assistance from NKK Corporation, when no such payment was due to the latter. Alternatively, he is charged with dishonestly disposing of the funds by entering into an agreement with NKK Corporation and authorising payment for the amount without the approval of the board of directors or the tender committee of Perwaja Rolling Mill Development Sdn Bhd. He is alleged to have committed both offences as managing director of Perwaja Rolling Mill Development Sdn Bhd at its office at Menara UBN on Jalan P Ramlee here, between Nov 4, 1993, and Feb 22, 1994. Another witness, Jesse Leung Ngai Chow, said he signed a letter on behalf of Apex Corporate Services Limited, directed to American Express Bank, on an application to open a bank account for Frilsham Enterprise Incorporated. Leung, who worked part-time at Apex as the managing director between 1993 and 1994, said the letter needed the signatures of four authorized signatories T. O. Yip, Robert Kong, H. Y Tan and himself. Asked to name the person who gave the instruction to open the account, Leung said it was Yuji Maeda. Apex Corporate Services Limited provides incorporation of companies, company secretarial services, setting up of trusts and trustee, corporation nominee director and operation of bank accounts. Leung agreed that the two signature cards referring to two Frilsham Enterprise bank accounts were dated Feb 2, 1994, and both indicated closure of account on July 7, 1994. Another letter by Yuji Maeda instructed American Express Bank Limited to transfer the amount of 2,890,130,210 yen to Waterfront International Limited through a bank account 9547003126, he said. On the search conducted by Michael Burley, acting chief investigating officer of the Independent Commission Against Corruption (ICAC), Leung said: Although the clients (Frilsham Enterprise) current status report which, was kept by Apex, was struck off, the Hongkong ICAC could still detect and reactivate that data. Leung said he did not know how the ICAC officers, who conducted the search on July 15 this year, could detect the data and added that it was suprising as Frilsham Enterprise was not functioning anymore and its data have been deleted completely. Under cross-examination by lead defence counsel Datuk Muhammad Shafee Abdullah, Leung said the Anti-Corruption Agency in Malaysian made two visits to Apex Corporate Services Ltd for investigations. The first visit was on June 19, 1996, to check some details without any seizure, while the second visit was in April this year. Leung confirmed that Yuji Maeda was the only one who gave any instructions to Apex pertaining to Frilsham Enterprise. Asked how many companies Yuji Maeda had asked Apex to maintain for him, he said: A couple more, such as Sakyo Consultancy Inc. Ltd, Borneo Enterprise. However, when asked whether Sita Investment Ltd was included in the list, Leung replied in the negative. The prosecution led by Attorney-General Tan Sri Gani Patail kept its promise to wrap up on Thursday its recording of evidence here on the alleged money trail pertaining to the RM76. 4 million when it called its sixth and last witness to the stand Cheng Tai Foon, a nominee director of Borneo Enterprise in January 1994. Cheng, who is currently a director in a security firm, said he signed an application to open a bank account in Banque Indosuez on the instruction of Leung, who was his former boss when they were working at an accounting firm, John Byrn and Co. Asked how he got involved in signing as a nominee director, Cheng said Leung often referred cases to him and he admitted that he was also a nominee director of other companies such as Borneo Enterprise.

Sunday, July 21, 2019

Concepts and Theories of Auditing

Concepts and Theories of Auditing Auditing has been present for years in different stage of development following the evolution of accounting. Starting since the epoch when the records were approved after a public reading, to the era when governments officials were measured by their honesty. Followed by the times of the industrial revolution were the ownership of companies started separating from management; when owners required more protection of their investments increasing the use of auditors, consequently; to the times were an auditor was always searching for frauds or errors (Whittington Pany, 2004, p. 7) and then to ascertain the actual financial condition and earnings of an enterprise (Montgomery, 1913, p. 9). However, the acceptance of auditing as an academic discipline is not old and just after the development of different concepts and techniques within the audit model such as the use of sampling, the study of the internal control environment, and the risk assessment, is when more focus to the theoretical and conceptual framework of auditing it is been devoted. Andrew Sayer (1992) discussed the concept of theories in social science from the perspective of theory as an ordering-framework (p. 50), indicating that theory allows the use of the observed data and their relationships to predict and explain empirical events. Additionally Cooper and Schindler (1998) define theory as a set of systematically interrelated concepts, definitions, and propositions that are advanced to explain and predict phenomena (facts) (p. 47). Another concept is expressed by Singleton and Straits (2005) explaining theory as a set of interconnected propositions (p. 19). The success in the explanations or predictions of any phenomena depends on the level that the theory holds and do not fails fitting in the situation, and the challenge is to perfect the process of matching theory and fact (Cooper and Schindler (1998). Different authors have started the development of the audit theory such as Mautz and Sharaf (1961) with their publication titled The Philosophy of Auditing; also Tom Lee (1986) with his approach in the book Company Auditing, and later David Flint (1988) with his book Philosophy and principles of auditing (as cited in Moizer, 1989). The auditing analysis in this demonstration will be framed on the postulates proposed by David Flint (1988) as a foundation for the theory of auditing. Flint (1988) stated that there is a matter of public accountability demanding an independent audit for its demonstration with clear definition and intention, based on evidence that only skilled auditors gather, measure it, and compare it against the standards, which generates economic or social benefit (as cited in Moizer, 1989). Following are the seven postulates or assumptions stated by Flint (1988): There is a relationship of accountability or a situation of public accountability. Accountability cannot be demonstrated without an audit. An audit requires independence and freedom. The subject matter of audit is susceptible to verification by evidence. Auditors are skilled judges who are able to measure and compare actual performance against standards of accountability. The meaning, significance, and intention of statements to be audited must be clear. An audit produces an economic or social benefit. (Flink, 1989) Whenever an economic relationship exists one of the parties owe a duty of an acceptable accountability, consequently audits are voluntary, imposed for the health of the relationship. There are also audit related to the interest of the public in matters of the society institutions. As expressed by Whittington and Pany (2004) dependable information is essential to the very existence of our society (p. 1). They explained the social need for audit and professionals who can attest that the reported information is fair respect to the reality for purpose of allocating resources for the production of services and goods based on reliable financial information (p. 1). Normally the financial and economic aspects of the related subject matter are complex, not physically accessible, or have the level of significance that necessary demand an audit to accept the accountability. No all investors or stakeholders of an entity understand the complexity of the business and financial environment, or are near to the place were their resources are to oversee for accountability. The credibility of the information is important and the preferable form of obtaining credible information to rely on is by using independent auditors to perform an audit. That reduce the business risk that relates to the permanence and profits of the company, and the information risk that the financial information used to make a decision is materially misstated (Whittington Pany, 2004, p. 6). Therefore, if the audit must add credibility it must be performed independently and without bias or prejudice. Audit is subject to verification and that is possible only if sufficient evidential matter of the audit is gathered. Additionally, some standards of accountability and performance need to be in place to easy the auditors measurement. Therefore, the parties involved must agree on their acceptable standards. The auditing community has set some professional guidance as a form of general accepted practiced standards. For an audit to add value to the financial information, the purpose of the information should be clear, and the findings effectively communicated. The audit should be performed only when its benefits weigh more than the costs. As a consequence auditors should be aware of the cost of collecting evidence especially in situation were the risk is high. The practice of auditing auditors agree on an attest engagement in which they issue or does issue an examination, a review, or an agreed-upon procedures report on subject matter or an assertion about subject matter that is the responsibility of another party (e.g., management) (Whittington Pany, 2004, p. 2). In an examination of financial statement, referred to as an audit the standards may be the Generally Accepted Accounting Principles (GAAP), and the auditors collect sufficient evidence to attest about how fair is the information in the financial statement respect to the GAAP. However, here are three types of audits: (a) audits of financial statements, (b) compliance audits, and (c) operational audits. Financial audits determine if the statements were prepared according with GAAP. Compliance audit verifies if the company had complies with law, regulations or polices and procedures. Finally, operational audits review the effectiveness and efficiency of particular unit of an organization (Whittington Pany, 2004, p. 11). Relative to the public accounting standards, the American Institute of Certified Public Accountants (AICPA) has developed the framework for the general accepted auditing standards (GAAS), which are the fundamentals principles of independent auditing in the U. S. The framework is divided in three major areas that are summarized as follow: General standards. A professional possessing adequate technical training and proficiency, independent in mental attitude and free from bias and with professional care planning and performing diligently, perform the audit. Standards of field work. The audit should be adequate planned and the staff properly supervised. Auditor should acquire sufficient understanding of the internal control environment to be able to determine the weak areas, and gather sufficient competent evidence to support their conclusions. Standards of reporting. The final report should state if the statements are consistent with GAAP and if necessary indicate those circumstances departing from GAAP, include adequate informative disclosure, and includes the opinion of the auditors about the financial statements. Likewise, the AICPA has issued a series of auditing standards on auditing procedure, auditing and accounting guides, and auditing statements of position, to help auditor in the fulfillment of their responsibility of detecting misstatement (Whittington Pany, 2004, pp. 34-35). Auditing involve a serious processes that expose auditors to a different situations in which they need to exercise professional ethics. Those moral principles and values leading decisions and actions of the profession of auditing are provided by the AICPA in the Code of Professional Conduct, and by the Institute of Internal Auditors (IIA) Code of Ethics. Normally auditors are involved in a decision process of ethical dimension. CPAs decisions during performing their duties can affect thousands of investors and their resources; therefore, they need to measure the implication of their decisions. Additionally, as Whittington and Pany (2004) indicated, what is considered unethical in a particular society is not specifically prohibited (p. 11), giving relevance and support to the need for the establishment of those principles and values in the accounting and auditing profession. The public accounting, as well as the rest of professions, has the following characteristics: (a) their responsibility to serve the public with independence and due care with fairness and free from bias. (b) Involves a complex body of knowledge that includes different authoritative pronouncements of standards and principles governing the profession and the financial reports due to the need of technical competency. (c) Has establishes some standard of admission to the profession that each CPA is required to meet. In addition (d), need public confidence to be successful (Whittington Pany, 2004, pp. 61-62). The AICPA leads public accountants to recognize their responsibility to the public in general, to their clients, and to the profession. The section one of the code of conduct describes the organization and CPAs principles of responsibilities, public interest, integrity, objectivity and independence, due care, and scope and nature of services. The section two depicts the institutes rules that are compounded by the following: independence, integrity and objectivity, general standards, compliance with standards, accounting principles, confidential client information, contingent fees, acts discreditable, advertising and other forms of solicitation, commissions and referral fees, and form of organization and name (Whittington Pany, 2004, pp. 63-83). Similarly, the IIA has their own code of ethics divided in three main sections, an introductory section, principles, and rules of conduct. Their principles apply to the profession and practice of the internal auditing, and include integrity, objectivity confidentiality, and competency. The IIA rules on conduct include integrity, objectivity, confidentiality, and competency (Whittington Pany, 2004, pp. 83-84). The IIA is the organization that provides the standards for the professional practice of internal auditing. As it can be deduced from the previous summaries, both institutes the IACPA and the IIA require high level of self-discipline and commitment to a honorable professional behavior, integrating similar principles of integrity, objectivity, and competence. Their rules differ in the fact that internal auditors perform internally; public accountants attest on the financial statements to the company as outsiders performing professionally to honor the public trust. However, the concept of independence is common to both ramification of auditing because it refers to the ability to maintain and objective and impartial mental attitude (Whittington Pany, 2004, p. 66), and without of conflict of interest. After the previous review of the auditing theory and how CPAs support it with a professional framework that includes principles, ethical codes, and general accepted standards for the auditing practice, the following section depicts a discussion of audit procedures as well as an introduction of important concepts that are fundamental part of the theory of auditing and the auditing practice. The Audit Procedures The ultimate product after the performance of an audit is the issuance of a report indicating if the financial statements audited comply with GAAP. Sufficient evidence must support the audit report and such evidence is gathered and documented by exercising rigorous procedures that, among other important goals, help the auditors in assessing the risk of misstatement. According to Whittington and Pany (2004), audit procedures involve: (a) the understanding of the client, the business, and industry to use it in assessing risks; (b) the understanding of the internal control environment; (c) the design and performance of controls testing to assess how effective the controls are in preventing or detecting material misstatements; and (d) the design and performance of substantive procedures that include analytical procedures, direct testing of transactions and ending balances (pp. 138-139). Because the internal control is the focus of interest for this demonstration, a separate section will discuss it. The substantive procedures include analytical procedures, the testing of transactions, and the testing of the ending balances on the statements. Analytical procedures consist of an analysis and evaluation of the information present in the financial statements, and a review of the relationship between financial and nonfinancial information. The assumption behind the analytical procedures is that the relationship and trend of the financial information is expected to follow the historical data and projections of the business and in contrary situation evidence must be obtained to support the reasonability of the changes (Whittington Pany, 2004, p. 141). Different techniques are use during the analytical procedures. From simple verification of a number to complicated mathematical models, such the comparison of cumulative expenses and revenues with prior years to find significant differences, the use of multiple regression model to estimate revenues by using economic and industry data, and ratio analysis and its comparison with other businesses in the same industry (Whittington Pany, 2004 (p. 141). The testing procedures seek to prove the occurrence and correct recognition of transactions, and prove of existence and misstatements on what the ending balances represent. The substantive testing procedures are performed as an interim mode before year-end, and then after the business year-end. The level of risk established by the auditors during the overall business assessment guides the extent of the substantive audit procedures. The greater the risk of material misstatement the greater the needed extent of substantive procedures (Whittington Pany, 2004, p. 139), but always keeping under evaluation the cost-benefit relation of increasing the procedures to perform. Among the most common test performed in an audit process, Whittington and Pany (2004) summarized the following: Accounting System: Comparison-Agreeing amounts from different internal records. Documentary evidence: Tracing-Establishing the completeness of transaction processing by following a transaction forward through the accounting records. Vouching-Establishing the existence or occurrence of recorded transactions by following a transaction back to supporting documents forms a subsequent processing step. Inspection-Reading or point-by-point review of a document or record (the terms examine, review, read, and scan are used to describe the inspection technique). Reconciliation-Establishing agreement between two sets of independently maintained but related records. Third-party representation: Confirmation and evaluating a response from a debtor, creditor, or other party in reply to a request for information about a particular item affecting the financial statements. Physical evidence: Physical examination-viewing physical evidence of an asset. Observation-viewing a client activity. Computations: Reperformance-repeating a client activity. This may include operations such as footing (providing the total of a vertical column of figures); cross footing (proving the total of a horizontal row of figures); and extending (re-computing by multiplication). Data interrelationships: Analytical procedures-Evaluation of financial information made by a study of expected relationships among financial and nonfinancial data. Client representations: Inquires-questions directed toward appropriate client personnel. According to Whittington and Pany (2004), auditors also collect evidence from some subjective areas such as the accounting estimates, the fair market value measurement and disclosures, and transactions with related parties (pp. 146-148). After the development of audit procedures auditors test for existence or occurrence to search for misstatements and completeness searching for understatement, from transactions start to finish, and they test the accounting system from source documents to journals to ledgers. (Whittington Pany, 2004, p. 195). The audit program includes two main parts, the assessment of the effectiveness of the client internal controls, and substantive testing. Normally the system portion of an audit program is divided by cycle such as revenue, purchasing and payments, production, payroll, investing, and financing (Whittington Pany, 2004, p. 196). Audit Risk The risk concept is use in different disciplines for different purposes. A simple definition of the concept is that: risk is the level of exposure to the chance that some event happens. The event might be beneficial or prejudicial, or might have subsequent implications to other situations or process. Therefore, in business there is a risk of losing money, a risk of fraud, and a risk of misstatement the financial information. As consequence, business and individuals manage risk and the level of exposure to specific risk according to their judgment. The audit process involves the management of risk in different areas with the goal to reduce it to the minimum level possible. Whittington and Pany (2004) introduced some of the risks concepts such as: business risk, the risk associated with a companys survival and profitability (p. 6). Information risk, the risk that the information used to assess business risk is not accurate (p. 6). Audit risk, the risk that the auditors may unknowingly fail to appropriately modify the opinion on financial statements that are materially misstated (p. 35). Inherent risk, the possibility of a material misstatement of an assertion before considering the clients internal control (p.128). Control risk, the risk that a material misstatement will not be prevented or detected on a timely basis by the clients internal control (p. 129) Detection risk, the risk that the auditors will fail to detect the misstatement with their audit procedures (p. 129). Within the audit risk, auditors assess the risk level of occurrence of the different form of misstatement of financial statement, such as errors, fraud, and illegal acts. In measuring audit risk auditors use the following model: AR = IR x CR x DR Where: AR = Audit risk, IR = Inherent risk, CR = Control risk, and DR = Detection risk. (Whittington Pany, 2004, p. 130) Additionally, because the auditors are expose to some legal responsibility and are subject to be sued by any clients stakeholder, they have to take in consideration the reputation of the management, financial strength, and other financial rating to assess the overall risk or engagement risk of the association with that particular business (Whittington Pany, 2004, p. 174). The process of planning the audit involves the understanding of the client and its environment, an overall audit strategy, and the risk assessment of financial statements material misstatement. Therefore, auditors seek to understand the nature of the client and accounting polices, the industry, regulations and external factors affecting the client, the clients objectives, strategies, and related business risk, how the client measure and review performance, and the internal control environment. (Whittington Pany, 2004, pp. 179-180). Consequently, auditors use different sources to obtain the client overall understanding. That includes electronic research tools, visit to different plant or location of the client, and some analytical procedures. (Whittington Pany, 2004, pp. 181-183). A Companys internal control consists of the policies and procedures established to provide reasonable assurance that the objectives of the company will be achieved; including the clients internal control, they could identify areas of strength as well as of weakness. The stronger the internal control, the less testing of financial statement account balances required by the auditors. For any significant account or any phase of financial operation in which controls were weak, the auditors expanded the nature and extent of their tests of the account balance. With the increased reliance on sampling and internal control, professional standards began to emphasize limitations on auditors ability to detect fraud. The profession recognized that audits designed to discover fraud would be too costly. Good internal control and surety bonds were recognized as better fraud protection techniques than audits. (Whittington Pany, 2004, p. 8) The assessment of inherent risk involves considering the likelihood that material misstatement in financial statement will result, and each risk related to the management assertions. At this stage, auditors identify what it is not correct or the significant risk by area and based on that assessment they adjust their approach, modifying the nature, timing, and extent of the audit procedures (Whittington Pany, 2004, pp. 188-189). Audit Evidence Evidence is all data and information gathered by the auditors to support auditors conclusions. The importance of the evidence is that audit risk is reduced by gathering audit evidence (Whittington Pany, 2004, p. 127) and when the risk is high more evidence is necessary as well as the increasing the coverage of audit procedures. According to Whittington and Pany (2004), evidence need to be collected for each financial statement assertion sufficiently to support their opinion. As issued in the Statement of Auditing Standard (SAS) 31 about evidential matter, the financial statement assertions are the following: Existence or occurrence-assets, liabilities, and owners equity reflected in the financial statements exist; the recorded transactions have occurred. Completeness-all transactions, assets, liabilities, and owners equity that should be presented in the financial statements are included. Rights and obligations-the client has rights to assets and obligation to pay liabilities that are included in the financial statements. Valuation or allocation-assets, liabilities, owners equity, revenues, and expenses are presented at amounts that are determined in accordance with generally accepted accounting principles. Presentation and disclosure-accounts are described and classified in the financial statements in accordance with generally accepted accounting principles, and all material disclosures are provides. (Whittington Pany, 2004, p. 174) The above assertions are the base for the risk assessment performed by auditors, and to determine misstatements possible to occur and consequently decide the audit procedure to exercise. Guidelines are included in the SAS 31 regarding what sufficient competent evidence is, which relates to the quantity of evidence auditors should collect. The competence of the evidence is determined by the combined condition of relevant and valid. That means that it most related to the assertion, and that it is dependent on the circumstance in which it is obtained. The reliability or validity of the evidence increase when is received from independent sources, when is produced by an effective internal control, gathered directly by the auditor, is documented, obtained from original documents, and when is received from more than one source (Whittington Pany, 2004, p. 132). Different types of audit evidence is obtained by the auditors such as accounting information system, internal and external documentary evidence, third-party representations such as confirmations, reports, and lawyers letters; physical evidence such as fixed assets and inventory, computations re-performance, data interrelationships of financial and nonfinancial information, and client representations oral and in writing (Whittington Pany, 2004, pp. 131-137). An important supporting evidence of the audit report and conclusions is the audit documentation, which is required by the SAS 96 for the auditors understanding and review of the audit work, the nature of audit work performed, and to show the agreement between the records and the financial statements. The working papers have some important functions: (a) are the best way to assign and coordinate the auditing work, (b) help audit managers and partners in the supervision and reviewing or the work of assistants, (c) support the audit reports, (d) documents the auditors compliance with GAAS, and (d) assist in the conduction of future audit to the client (Whittington Pany, 2004, pp. 148-150). The working papers are confidential and unrestricted documentation owned by the auditors, principally because they represent the major factor to use in case of negligence charges. Part of the working paper are the administrative working papers, the working trial balance, separate schedules, adjusting journal entries and supporting schedules, and analysis of ledgers accounts such as a reconciliation, computational working paper, corroborating documents. They are filed in two major groups, permanent file, and current files (Whittington Pany, 2004, pp. 151-158). Audit Sampling As a large-scale corporate grow rapidly auditors began to sample selected transactions, rather than study all transactions. Auditors and business managers gradually came to accept the proposition that careful examination of relatively few selected transactions would give a cost-effective, reliable indication of the accuracy of other similar transactions (Whittington Pany, 2004, p. 8). As explained before, auditors need sufficient and competent evidence to support their conclusions, but because business grows involving high volume of economic events and transactions, they need to rely in sampling testing. Audit sampling can be statistical or no statistical, involves the selection of a sample from a group of items and the use of the sample characteristics presuming that the auditors can draw inferences about the whole population. (Whittington Pany, 2004, p. 309). From the previous sampling introduction, we have the sample risk that is the risk that the auditors conclusion based on a sample might be different if they examine the whole population. According to Whittington and Pany (2004) sampling risk is reduced by increasing the size of the sample (p. 309) or by auditing the whole population. Auditors use statistical and no statistical sampling to perform a random selection, which involve that every item in the population has an equal chance of being selected for inclusion in the sample. Different techniques are used such as random number tables, random number generators, systematic selection, haphazard selection, block selection, and stratification (Whittington Pany, 2004, pp. 310-313). There is a sample risk for test of controls in which auditors face the risk of assessing control risk too high, which is related to efficiency, or too low based on the operating effectiveness of the control. The AICAP guide suggest the statistical sample sizes for tests of controls at 5 percent risk of assessing control risk too low, providing the following tolerable deviation rate per assessed level of control risk: for low 2 7%, for moderate 6 12 %, for slightly below the maximum 11 20%, and for maximum level of control risk they recommend to omit test (Whittington Pany, 2004, pp. 316-320). Besides sampling, auditors became aware of the importance of effective internal auditing. Following section presents a discussion about internal auditing. Internal Auditing The internal auditing developed rapidly during the decade of 1930s generating the foundation of the Institute of Internal Auditors (IIA), which is an organization with local chapter in the main cities worldwide. The IIA defines internal adducting as follows: An independent, objective assurance and consulting activity designed to add value and improve an organizations operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance process. (The Institute of Internal Auditors [IIA], 2008) Internal auditors are an important part of the internal control environment of entities, representing the highest level of control that measure and evaluate the effectiveness of other controls. Additionally to the financial controls, the internal auditors scope includes the evaluation and testing of control effectiveness, and other assurance and consulting services to the management. Some companies have focus on outsourcing the internal audit functions, which is also provided by CPA firms as an extended audit service and according to the AICPA guiding. However, opposition to the participation of accounting firms exist under the argument of possible conflicts of interest having then as part of the internal control when they also audit the company. The IIA have issued the standards for the practice of internal auditing with the following purpose: To delineate basic principles that represent the practice of internal auditing. Provide a framework for performing and promoting a broad range of value-added internal auditing. Establish the basis for the evaluation of internal audit performance. To foster improved organizational processes and operations. The auditing standards of the IIA includes two parts, the first is the attribute standards that state basic requirements for the practice of internal auditing. According with this attribute, organizations should define in a formal document or internal audit charter, the purpose, authority, and responsibility of the internal audit, and the nature of assurance and consulting services that the internal auditors will provide. Additionally, the chapter should include recognition of the definition of internal auditing, the code of ethics, and the auditing standards (IIA, 2008). The standards also state the independence and objectivity condition for internal auditors during the performance of their work. The need of freedom from conditions, bias, and subordination of judgment, or conflict of interest that impairs their ability to perform objectively, is rigorously presented in the standards. Additionally, the competencies, knowledge, and skills that an auditor must possess are described as well as the due professional care requirement for the performance of the engagement as important elements of the IIA standards. Finally, the attribute standards set requirements for continuing professional development and quality assurance for the internal audit activity (IIA, 2008). The second part of the IIA standards covers the Concepts and Theories of Auditing Concepts and Theories of Auditing Auditing has been present for years in different stage of development following the evolution of accounting. Starting since the epoch when the records were approved after a public reading, to the era when governments officials were measured by their honesty. Followed by the times of the industrial revolution were the ownership of companies started separating from management; when owners required more protection of their investments increasing the use of auditors, consequently; to the times were an auditor was always searching for frauds or errors (Whittington Pany, 2004, p. 7) and then to ascertain the actual financial condition and earnings of an enterprise (Montgomery, 1913, p. 9). However, the acceptance of auditing as an academic discipline is not old and just after the development of different concepts and techniques within the audit model such as the use of sampling, the study of the internal control environment, and the risk assessment, is when more focus to the theoretical and conceptual framework of auditing it is been devoted. Andrew Sayer (1992) discussed the concept of theories in social science from the perspective of theory as an ordering-framework (p. 50), indicating that theory allows the use of the observed data and their relationships to predict and explain empirical events. Additionally Cooper and Schindler (1998) define theory as a set of systematically interrelated concepts, definitions, and propositions that are advanced to explain and predict phenomena (facts) (p. 47). Another concept is expressed by Singleton and Straits (2005) explaining theory as a set of interconnected propositions (p. 19). The success in the explanations or predictions of any phenomena depends on the level that the theory holds and do not fails fitting in the situation, and the challenge is to perfect the process of matching theory and fact (Cooper and Schindler (1998). Different authors have started the development of the audit theory such as Mautz and Sharaf (1961) with their publication titled The Philosophy of Auditing; also Tom Lee (1986) with his approach in the book Company Auditing, and later David Flint (1988) with his book Philosophy and principles of auditing (as cited in Moizer, 1989). The auditing analysis in this demonstration will be framed on the postulates proposed by David Flint (1988) as a foundation for the theory of auditing. Flint (1988) stated that there is a matter of public accountability demanding an independent audit for its demonstration with clear definition and intention, based on evidence that only skilled auditors gather, measure it, and compare it against the standards, which generates economic or social benefit (as cited in Moizer, 1989). Following are the seven postulates or assumptions stated by Flint (1988): There is a relationship of accountability or a situation of public accountability. Accountability cannot be demonstrated without an audit. An audit requires independence and freedom. The subject matter of audit is susceptible to verification by evidence. Auditors are skilled judges who are able to measure and compare actual performance against standards of accountability. The meaning, significance, and intention of statements to be audited must be clear. An audit produces an economic or social benefit. (Flink, 1989) Whenever an economic relationship exists one of the parties owe a duty of an acceptable accountability, consequently audits are voluntary, imposed for the health of the relationship. There are also audit related to the interest of the public in matters of the society institutions. As expressed by Whittington and Pany (2004) dependable information is essential to the very existence of our society (p. 1). They explained the social need for audit and professionals who can attest that the reported information is fair respect to the reality for purpose of allocating resources for the production of services and goods based on reliable financial information (p. 1). Normally the financial and economic aspects of the related subject matter are complex, not physically accessible, or have the level of significance that necessary demand an audit to accept the accountability. No all investors or stakeholders of an entity understand the complexity of the business and financial environment, or are near to the place were their resources are to oversee for accountability. The credibility of the information is important and the preferable form of obtaining credible information to rely on is by using independent auditors to perform an audit. That reduce the business risk that relates to the permanence and profits of the company, and the information risk that the financial information used to make a decision is materially misstated (Whittington Pany, 2004, p. 6). Therefore, if the audit must add credibility it must be performed independently and without bias or prejudice. Audit is subject to verification and that is possible only if sufficient evidential matter of the audit is gathered. Additionally, some standards of accountability and performance need to be in place to easy the auditors measurement. Therefore, the parties involved must agree on their acceptable standards. The auditing community has set some professional guidance as a form of general accepted practiced standards. For an audit to add value to the financial information, the purpose of the information should be clear, and the findings effectively communicated. The audit should be performed only when its benefits weigh more than the costs. As a consequence auditors should be aware of the cost of collecting evidence especially in situation were the risk is high. The practice of auditing auditors agree on an attest engagement in which they issue or does issue an examination, a review, or an agreed-upon procedures report on subject matter or an assertion about subject matter that is the responsibility of another party (e.g., management) (Whittington Pany, 2004, p. 2). In an examination of financial statement, referred to as an audit the standards may be the Generally Accepted Accounting Principles (GAAP), and the auditors collect sufficient evidence to attest about how fair is the information in the financial statement respect to the GAAP. However, here are three types of audits: (a) audits of financial statements, (b) compliance audits, and (c) operational audits. Financial audits determine if the statements were prepared according with GAAP. Compliance audit verifies if the company had complies with law, regulations or polices and procedures. Finally, operational audits review the effectiveness and efficiency of particular unit of an organization (Whittington Pany, 2004, p. 11). Relative to the public accounting standards, the American Institute of Certified Public Accountants (AICPA) has developed the framework for the general accepted auditing standards (GAAS), which are the fundamentals principles of independent auditing in the U. S. The framework is divided in three major areas that are summarized as follow: General standards. A professional possessing adequate technical training and proficiency, independent in mental attitude and free from bias and with professional care planning and performing diligently, perform the audit. Standards of field work. The audit should be adequate planned and the staff properly supervised. Auditor should acquire sufficient understanding of the internal control environment to be able to determine the weak areas, and gather sufficient competent evidence to support their conclusions. Standards of reporting. The final report should state if the statements are consistent with GAAP and if necessary indicate those circumstances departing from GAAP, include adequate informative disclosure, and includes the opinion of the auditors about the financial statements. Likewise, the AICPA has issued a series of auditing standards on auditing procedure, auditing and accounting guides, and auditing statements of position, to help auditor in the fulfillment of their responsibility of detecting misstatement (Whittington Pany, 2004, pp. 34-35). Auditing involve a serious processes that expose auditors to a different situations in which they need to exercise professional ethics. Those moral principles and values leading decisions and actions of the profession of auditing are provided by the AICPA in the Code of Professional Conduct, and by the Institute of Internal Auditors (IIA) Code of Ethics. Normally auditors are involved in a decision process of ethical dimension. CPAs decisions during performing their duties can affect thousands of investors and their resources; therefore, they need to measure the implication of their decisions. Additionally, as Whittington and Pany (2004) indicated, what is considered unethical in a particular society is not specifically prohibited (p. 11), giving relevance and support to the need for the establishment of those principles and values in the accounting and auditing profession. The public accounting, as well as the rest of professions, has the following characteristics: (a) their responsibility to serve the public with independence and due care with fairness and free from bias. (b) Involves a complex body of knowledge that includes different authoritative pronouncements of standards and principles governing the profession and the financial reports due to the need of technical competency. (c) Has establishes some standard of admission to the profession that each CPA is required to meet. In addition (d), need public confidence to be successful (Whittington Pany, 2004, pp. 61-62). The AICPA leads public accountants to recognize their responsibility to the public in general, to their clients, and to the profession. The section one of the code of conduct describes the organization and CPAs principles of responsibilities, public interest, integrity, objectivity and independence, due care, and scope and nature of services. The section two depicts the institutes rules that are compounded by the following: independence, integrity and objectivity, general standards, compliance with standards, accounting principles, confidential client information, contingent fees, acts discreditable, advertising and other forms of solicitation, commissions and referral fees, and form of organization and name (Whittington Pany, 2004, pp. 63-83). Similarly, the IIA has their own code of ethics divided in three main sections, an introductory section, principles, and rules of conduct. Their principles apply to the profession and practice of the internal auditing, and include integrity, objectivity confidentiality, and competency. The IIA rules on conduct include integrity, objectivity, confidentiality, and competency (Whittington Pany, 2004, pp. 83-84). The IIA is the organization that provides the standards for the professional practice of internal auditing. As it can be deduced from the previous summaries, both institutes the IACPA and the IIA require high level of self-discipline and commitment to a honorable professional behavior, integrating similar principles of integrity, objectivity, and competence. Their rules differ in the fact that internal auditors perform internally; public accountants attest on the financial statements to the company as outsiders performing professionally to honor the public trust. However, the concept of independence is common to both ramification of auditing because it refers to the ability to maintain and objective and impartial mental attitude (Whittington Pany, 2004, p. 66), and without of conflict of interest. After the previous review of the auditing theory and how CPAs support it with a professional framework that includes principles, ethical codes, and general accepted standards for the auditing practice, the following section depicts a discussion of audit procedures as well as an introduction of important concepts that are fundamental part of the theory of auditing and the auditing practice. The Audit Procedures The ultimate product after the performance of an audit is the issuance of a report indicating if the financial statements audited comply with GAAP. Sufficient evidence must support the audit report and such evidence is gathered and documented by exercising rigorous procedures that, among other important goals, help the auditors in assessing the risk of misstatement. According to Whittington and Pany (2004), audit procedures involve: (a) the understanding of the client, the business, and industry to use it in assessing risks; (b) the understanding of the internal control environment; (c) the design and performance of controls testing to assess how effective the controls are in preventing or detecting material misstatements; and (d) the design and performance of substantive procedures that include analytical procedures, direct testing of transactions and ending balances (pp. 138-139). Because the internal control is the focus of interest for this demonstration, a separate section will discuss it. The substantive procedures include analytical procedures, the testing of transactions, and the testing of the ending balances on the statements. Analytical procedures consist of an analysis and evaluation of the information present in the financial statements, and a review of the relationship between financial and nonfinancial information. The assumption behind the analytical procedures is that the relationship and trend of the financial information is expected to follow the historical data and projections of the business and in contrary situation evidence must be obtained to support the reasonability of the changes (Whittington Pany, 2004, p. 141). Different techniques are use during the analytical procedures. From simple verification of a number to complicated mathematical models, such the comparison of cumulative expenses and revenues with prior years to find significant differences, the use of multiple regression model to estimate revenues by using economic and industry data, and ratio analysis and its comparison with other businesses in the same industry (Whittington Pany, 2004 (p. 141). The testing procedures seek to prove the occurrence and correct recognition of transactions, and prove of existence and misstatements on what the ending balances represent. The substantive testing procedures are performed as an interim mode before year-end, and then after the business year-end. The level of risk established by the auditors during the overall business assessment guides the extent of the substantive audit procedures. The greater the risk of material misstatement the greater the needed extent of substantive procedures (Whittington Pany, 2004, p. 139), but always keeping under evaluation the cost-benefit relation of increasing the procedures to perform. Among the most common test performed in an audit process, Whittington and Pany (2004) summarized the following: Accounting System: Comparison-Agreeing amounts from different internal records. Documentary evidence: Tracing-Establishing the completeness of transaction processing by following a transaction forward through the accounting records. Vouching-Establishing the existence or occurrence of recorded transactions by following a transaction back to supporting documents forms a subsequent processing step. Inspection-Reading or point-by-point review of a document or record (the terms examine, review, read, and scan are used to describe the inspection technique). Reconciliation-Establishing agreement between two sets of independently maintained but related records. Third-party representation: Confirmation and evaluating a response from a debtor, creditor, or other party in reply to a request for information about a particular item affecting the financial statements. Physical evidence: Physical examination-viewing physical evidence of an asset. Observation-viewing a client activity. Computations: Reperformance-repeating a client activity. This may include operations such as footing (providing the total of a vertical column of figures); cross footing (proving the total of a horizontal row of figures); and extending (re-computing by multiplication). Data interrelationships: Analytical procedures-Evaluation of financial information made by a study of expected relationships among financial and nonfinancial data. Client representations: Inquires-questions directed toward appropriate client personnel. According to Whittington and Pany (2004), auditors also collect evidence from some subjective areas such as the accounting estimates, the fair market value measurement and disclosures, and transactions with related parties (pp. 146-148). After the development of audit procedures auditors test for existence or occurrence to search for misstatements and completeness searching for understatement, from transactions start to finish, and they test the accounting system from source documents to journals to ledgers. (Whittington Pany, 2004, p. 195). The audit program includes two main parts, the assessment of the effectiveness of the client internal controls, and substantive testing. Normally the system portion of an audit program is divided by cycle such as revenue, purchasing and payments, production, payroll, investing, and financing (Whittington Pany, 2004, p. 196). Audit Risk The risk concept is use in different disciplines for different purposes. A simple definition of the concept is that: risk is the level of exposure to the chance that some event happens. The event might be beneficial or prejudicial, or might have subsequent implications to other situations or process. Therefore, in business there is a risk of losing money, a risk of fraud, and a risk of misstatement the financial information. As consequence, business and individuals manage risk and the level of exposure to specific risk according to their judgment. The audit process involves the management of risk in different areas with the goal to reduce it to the minimum level possible. Whittington and Pany (2004) introduced some of the risks concepts such as: business risk, the risk associated with a companys survival and profitability (p. 6). Information risk, the risk that the information used to assess business risk is not accurate (p. 6). Audit risk, the risk that the auditors may unknowingly fail to appropriately modify the opinion on financial statements that are materially misstated (p. 35). Inherent risk, the possibility of a material misstatement of an assertion before considering the clients internal control (p.128). Control risk, the risk that a material misstatement will not be prevented or detected on a timely basis by the clients internal control (p. 129) Detection risk, the risk that the auditors will fail to detect the misstatement with their audit procedures (p. 129). Within the audit risk, auditors assess the risk level of occurrence of the different form of misstatement of financial statement, such as errors, fraud, and illegal acts. In measuring audit risk auditors use the following model: AR = IR x CR x DR Where: AR = Audit risk, IR = Inherent risk, CR = Control risk, and DR = Detection risk. (Whittington Pany, 2004, p. 130) Additionally, because the auditors are expose to some legal responsibility and are subject to be sued by any clients stakeholder, they have to take in consideration the reputation of the management, financial strength, and other financial rating to assess the overall risk or engagement risk of the association with that particular business (Whittington Pany, 2004, p. 174). The process of planning the audit involves the understanding of the client and its environment, an overall audit strategy, and the risk assessment of financial statements material misstatement. Therefore, auditors seek to understand the nature of the client and accounting polices, the industry, regulations and external factors affecting the client, the clients objectives, strategies, and related business risk, how the client measure and review performance, and the internal control environment. (Whittington Pany, 2004, pp. 179-180). Consequently, auditors use different sources to obtain the client overall understanding. That includes electronic research tools, visit to different plant or location of the client, and some analytical procedures. (Whittington Pany, 2004, pp. 181-183). A Companys internal control consists of the policies and procedures established to provide reasonable assurance that the objectives of the company will be achieved; including the clients internal control, they could identify areas of strength as well as of weakness. The stronger the internal control, the less testing of financial statement account balances required by the auditors. For any significant account or any phase of financial operation in which controls were weak, the auditors expanded the nature and extent of their tests of the account balance. With the increased reliance on sampling and internal control, professional standards began to emphasize limitations on auditors ability to detect fraud. The profession recognized that audits designed to discover fraud would be too costly. Good internal control and surety bonds were recognized as better fraud protection techniques than audits. (Whittington Pany, 2004, p. 8) The assessment of inherent risk involves considering the likelihood that material misstatement in financial statement will result, and each risk related to the management assertions. At this stage, auditors identify what it is not correct or the significant risk by area and based on that assessment they adjust their approach, modifying the nature, timing, and extent of the audit procedures (Whittington Pany, 2004, pp. 188-189). Audit Evidence Evidence is all data and information gathered by the auditors to support auditors conclusions. The importance of the evidence is that audit risk is reduced by gathering audit evidence (Whittington Pany, 2004, p. 127) and when the risk is high more evidence is necessary as well as the increasing the coverage of audit procedures. According to Whittington and Pany (2004), evidence need to be collected for each financial statement assertion sufficiently to support their opinion. As issued in the Statement of Auditing Standard (SAS) 31 about evidential matter, the financial statement assertions are the following: Existence or occurrence-assets, liabilities, and owners equity reflected in the financial statements exist; the recorded transactions have occurred. Completeness-all transactions, assets, liabilities, and owners equity that should be presented in the financial statements are included. Rights and obligations-the client has rights to assets and obligation to pay liabilities that are included in the financial statements. Valuation or allocation-assets, liabilities, owners equity, revenues, and expenses are presented at amounts that are determined in accordance with generally accepted accounting principles. Presentation and disclosure-accounts are described and classified in the financial statements in accordance with generally accepted accounting principles, and all material disclosures are provides. (Whittington Pany, 2004, p. 174) The above assertions are the base for the risk assessment performed by auditors, and to determine misstatements possible to occur and consequently decide the audit procedure to exercise. Guidelines are included in the SAS 31 regarding what sufficient competent evidence is, which relates to the quantity of evidence auditors should collect. The competence of the evidence is determined by the combined condition of relevant and valid. That means that it most related to the assertion, and that it is dependent on the circumstance in which it is obtained. The reliability or validity of the evidence increase when is received from independent sources, when is produced by an effective internal control, gathered directly by the auditor, is documented, obtained from original documents, and when is received from more than one source (Whittington Pany, 2004, p. 132). Different types of audit evidence is obtained by the auditors such as accounting information system, internal and external documentary evidence, third-party representations such as confirmations, reports, and lawyers letters; physical evidence such as fixed assets and inventory, computations re-performance, data interrelationships of financial and nonfinancial information, and client representations oral and in writing (Whittington Pany, 2004, pp. 131-137). An important supporting evidence of the audit report and conclusions is the audit documentation, which is required by the SAS 96 for the auditors understanding and review of the audit work, the nature of audit work performed, and to show the agreement between the records and the financial statements. The working papers have some important functions: (a) are the best way to assign and coordinate the auditing work, (b) help audit managers and partners in the supervision and reviewing or the work of assistants, (c) support the audit reports, (d) documents the auditors compliance with GAAS, and (d) assist in the conduction of future audit to the client (Whittington Pany, 2004, pp. 148-150). The working papers are confidential and unrestricted documentation owned by the auditors, principally because they represent the major factor to use in case of negligence charges. Part of the working paper are the administrative working papers, the working trial balance, separate schedules, adjusting journal entries and supporting schedules, and analysis of ledgers accounts such as a reconciliation, computational working paper, corroborating documents. They are filed in two major groups, permanent file, and current files (Whittington Pany, 2004, pp. 151-158). Audit Sampling As a large-scale corporate grow rapidly auditors began to sample selected transactions, rather than study all transactions. Auditors and business managers gradually came to accept the proposition that careful examination of relatively few selected transactions would give a cost-effective, reliable indication of the accuracy of other similar transactions (Whittington Pany, 2004, p. 8). As explained before, auditors need sufficient and competent evidence to support their conclusions, but because business grows involving high volume of economic events and transactions, they need to rely in sampling testing. Audit sampling can be statistical or no statistical, involves the selection of a sample from a group of items and the use of the sample characteristics presuming that the auditors can draw inferences about the whole population. (Whittington Pany, 2004, p. 309). From the previous sampling introduction, we have the sample risk that is the risk that the auditors conclusion based on a sample might be different if they examine the whole population. According to Whittington and Pany (2004) sampling risk is reduced by increasing the size of the sample (p. 309) or by auditing the whole population. Auditors use statistical and no statistical sampling to perform a random selection, which involve that every item in the population has an equal chance of being selected for inclusion in the sample. Different techniques are used such as random number tables, random number generators, systematic selection, haphazard selection, block selection, and stratification (Whittington Pany, 2004, pp. 310-313). There is a sample risk for test of controls in which auditors face the risk of assessing control risk too high, which is related to efficiency, or too low based on the operating effectiveness of the control. The AICAP guide suggest the statistical sample sizes for tests of controls at 5 percent risk of assessing control risk too low, providing the following tolerable deviation rate per assessed level of control risk: for low 2 7%, for moderate 6 12 %, for slightly below the maximum 11 20%, and for maximum level of control risk they recommend to omit test (Whittington Pany, 2004, pp. 316-320). Besides sampling, auditors became aware of the importance of effective internal auditing. Following section presents a discussion about internal auditing. Internal Auditing The internal auditing developed rapidly during the decade of 1930s generating the foundation of the Institute of Internal Auditors (IIA), which is an organization with local chapter in the main cities worldwide. The IIA defines internal adducting as follows: An independent, objective assurance and consulting activity designed to add value and improve an organizations operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance process. (The Institute of Internal Auditors [IIA], 2008) Internal auditors are an important part of the internal control environment of entities, representing the highest level of control that measure and evaluate the effectiveness of other controls. Additionally to the financial controls, the internal auditors scope includes the evaluation and testing of control effectiveness, and other assurance and consulting services to the management. Some companies have focus on outsourcing the internal audit functions, which is also provided by CPA firms as an extended audit service and according to the AICPA guiding. However, opposition to the participation of accounting firms exist under the argument of possible conflicts of interest having then as part of the internal control when they also audit the company. The IIA have issued the standards for the practice of internal auditing with the following purpose: To delineate basic principles that represent the practice of internal auditing. Provide a framework for performing and promoting a broad range of value-added internal auditing. Establish the basis for the evaluation of internal audit performance. To foster improved organizational processes and operations. The auditing standards of the IIA includes two parts, the first is the attribute standards that state basic requirements for the practice of internal auditing. According with this attribute, organizations should define in a formal document or internal audit charter, the purpose, authority, and responsibility of the internal audit, and the nature of assurance and consulting services that the internal auditors will provide. Additionally, the chapter should include recognition of the definition of internal auditing, the code of ethics, and the auditing standards (IIA, 2008). The standards also state the independence and objectivity condition for internal auditors during the performance of their work. The need of freedom from conditions, bias, and subordination of judgment, or conflict of interest that impairs their ability to perform objectively, is rigorously presented in the standards. Additionally, the competencies, knowledge, and skills that an auditor must possess are described as well as the due professional care requirement for the performance of the engagement as important elements of the IIA standards. Finally, the attribute standards set requirements for continuing professional development and quality assurance for the internal audit activity (IIA, 2008). The second part of the IIA standards covers the