Page 9 - Microsoft Word - 00 P1 IW Prelims.docx

Regulation in a global economy

2.2 Relevance of corporate governance to the external auditors

A company complying with good corporate governance principles is likely to have a
stronger control environment, therefore less risk of material misstatement in the
financial statements.

External auditors may be required to report on whether companies are compliant with
corporate governance regulations.

2.3 UK Corporate Governance Code

The UK Corporate Governance Code provides the following guidance which is
relevant for both International and UK students.

Corporate
Governance Code

Relations with
Leadership Accountability
shareholders

Effectiveness Remuneration

5