• 1 Marks

AAA – Nov 2012 – L3 – SA – Q6 – Regulatory Framework and Professional Standards

Responsibilities and regulatory compliance of auditors conducting transnational audits.

Auditors that carry out transnational audit usually belong to multinational firms and as such are:

A. Independent of the local laws and regulations
B. Not expected to operate under the professional rules of any particular country
C. Not accountable to any supervisory body
D. Expected to buy the shares of the multinational corporations to gain entry into the country
E. Operating subject to national laws and professional values in more than one country

E. Operating subject to national laws and professional values in more than one country

Explanation:
The correct answer is “E” as auditors engaged in transnational audits must adhere to the national laws and professional standards in each country where they operate. This requirement ensures compliance with diverse regulatory frameworks and maintains the integrity of audits across borders, reflecting the professional values and legal expectations of multiple jurisdictions.

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