Document ID: chunk:federal_register_of_legislation:F2023C01125:body:0:p11
Version: federal_register_of_legislation:F2023C01125
Segment Type: other
Provision Reference: 
Character Range: 30248–33405

appropriate tests for compliance with these provisions of the laws and regulations.

Categories of Laws and Regulations (Ref: Para. 6)

A6.             The nature and circumstances of the entity may impact whether relevant laws and regulations are within the categories of laws and regulations described in paragraphs 6(a) or 6(b).  Examples of laws and regulations that may be included in the categories described in paragraph 6 include those that deal with:

           * Fraud, corruption and bribery.

           * Money laundering, terrorist financing and proceeds of crime.

           * Securities markets and trading.

           * Banking and other financial products and services.

           * Data protection.

           * Tax and superannuation liabilities and payments.

           * Environmental protection.

           * Public health and safety.

Considerations Specific to Public Sector Entities

A7.             In the public sector, there may be additional audit responsibilities with respect to the consideration of laws and regulations which may relate to the audit of the financial report or may extend to other aspects of the entity's operations.

Additional Responsibilities Established by Law, Regulation or Relevant Ethical Requirements (Ref: Para. 9)

A8.             Law, regulation or relevant ethical requirements may require the auditor to perform additional procedures and take further action.  For example, the APES 110 Code of Ethics for Professional Accountants (including Independence Standards) issued by the Accounting Professional & Ethical Standards Board (the Code) requires the auditor to take steps to respond to identified or suspected non‑compliance with laws and regulations and determine whether further action is needed.  Such steps may include the communication of identified or suspected non‑compliance with laws and regulations between auditors within the engagement team or other auditors performing work at entities or business units of a group for purposes other than the audit of the group financial report.[11]

Definition (Ref: Para. 12)

A9.             Acts of non‑compliance with laws and regulations include transactions entered into by, or in the name of, the entity, or on its behalf, by those charged with governance, by management or by other individuals working for or under the direction of the entity.

A10.         Non‑compliance also includes personal misconduct related to the business activities of the entity, for example, in circumstances where an individual in a key management position, in a personal capacity, has accepted a bribe from a supplier of the entity and in return secures the appointment of the supplier to provide services or contracts to the entity.

The Auditor's Consideration of Compliance with Laws and Regulations

Obtaining an Understanding of the Legal and Regulatory Framework (Ref: Para. 13)

A11.         To obtain a general understanding of the legal and regulatory framework, and how the entity complies with that framework, the auditor may, for example:

           * Use the auditor's existing understanding of the entity's industry, regulatory and