Learning ObjectivesLO1 Introduce the concept of auditor responsibilities.

LO2 Explain the importance of the study of ethics in helping define auditor responsibilities.

LO3 Outline the characteristics of professionalskepticism and critical thinking.

LO4 Analyze whether a PA’s conduct conforms to principles underlying provincial rules of professional ethics.

1

Professional ScepticismAn inclination to question all material assertions made by management whether oral, written, or contained in the accounting records.

Balanced by a willingness to respect the integrity of management.

Results from the potential conflict of interest between management and users of financial information.

LO3

2

Critical Thinking FrameworkThe critical-thinking framework consists of principles, concepts and their application.

This framework provides structure to dealing with ethical and other issues.

Ethics is an important concept within the framework.

A questioning mind is a required precondition in the framework.

LO3

3

Critical ThinkingGoal: Do the right thing or learn the truth

1. Learn the views of others on the situation.

2. Identify the claims at issue.

3. Explain the reasons for the competing claims.

4. Evaluate the argument supporting the claim.

5. Reach a conclusion about the claim.

LO3

4

Critical ThinkingProfessional judgment in auditing is essentially critical thinking on accounting issues and the evidence related to them.

This reasoning should be documented.

LO3

5