Polo Babywear Ltd was formed on 30 August 2013 and its first financial year ended on 30 June 2015. The audit firm of Ross, Young & Partners has tendered for and won the audit for the first financial year. After signing the audit engagement letter, Mr. Ross is approached and asked to act as the company secretary for a period of 6 months because the company has had difficulty in obtaining staff. The role would be mainly to sign documents and to satisfy ASIC that the company had a complete set of officers. Mr. Ross would have no financial interest in the company through share ownership or otherwise, would receive no salary, would not keep the books, and would not give any advice that is different from what he would normally give in his duties as a public accountant.
Mr. Ross decides to accept the offer, conditional on the appointment being definitely completed before the rendering of the audit opinion on the financial statements.
Required:
Problem 1: Discuss Mr. Ross's acceptance of the dual roles of company secretary and auditor