Lyubimtseva_S_N__Koreneva_V_N_L_93_Kurs_angli

Ex. 8. a) Supply the articles where necessary.

b)Write down 3-5 questions about the text.

c)Say what you have learned from the text about government auditing in Sweden.

The Swedish National Audit Office (SNAO) is ... independent institution for central government auditing and accounting in ... Sweden. The main task of ... organisation is to audit the effective fulfilment of central government goals and commitments. In line with this, the organisation analyses revenues and expenditures of ... central government, audits central government activities, examines accounts and performance of all government agencies and ... public organisations. The SNAO selects independently ... agencies and activities to be audited, ... auditing methods to be used, ... content of the audit reports, as well as the audit statements. All audits are carried out in accordance with generally accepted auditing standards. The audits principally have ... control functions, but substantial efforts are also made to ensure that the results of the audit can be used as ... basis for improving efficiency and effectiveness. The SNAO also has ... task of imroving financial management at all levels of ... central government, of fostering high standards of financial management leading to the efficient use of central government funds, efficient cash flows and security of the payment system.

The government and ... Parliament use the information of the SNAO as a basis for their decisions on ...

development and transformation of the Swedish public administration. Besides, ... government often turns to the SNAO for ... comments on measures proposed by different public commissions.

In addition, ... SNAO establishes ... norms, develops auditing methods, and offers training and advice on issues related to auditing and financial management.

The staff are recruited on ... basis of educational qualifications and ... professional ability. Almost 95 per cent of the professional staff hold high professional qualifications.

Central government appropriations finance some fifty per cent of ... organisation's activity and the remaining activities are fee-financed. The SNAO is ... active member of INTOSAI (the International Organisation for Supreme Audit Institutions) and its European equivalent EUROSAI (the European Organisation for Supreme Audit Institutions).

Words you may need:

Swedish National Audit Office Государственная ревизионная служба Швеции

foster v поощрять, благоприятствовать cash flow поток наличных средств

public administration управление на государственном и местном уровнях appropriation n ассигнование

fee-financed на хозрасчете

INTOSAI Международная организация высших контрольных органов

EUROSAI Европейская организация высших контрольных органов

Ex. 9. a) Supply the prepositions where necessary.

b) Say what the auditors checked during the audit in accordance with the instructions given to them.

Auditors' Report

We have examined the books, accounts and vouchers relating the six. months ended 30th September ...

(year) which were presented ... us. We have made extensive enquiries ... the system of internal check ...

force and are satisfied that it is working efficiently. Particular attention was paid to the methods in force for the authorization of accounts for payment and the handling ... cash. The cash balances ... the 30th September

... (year) were counted and found to be in accordance ... the cashier's books. All bank payments have been verified with the bank statements and certificates of the balances on the accounts obtained ... the bankers. We have checked all cash and bank payments ... the receipts and have to report that a number of small payments are unsupported ... vouchers. It has been possible, however, to obtain other evidence to show that these disbursements were properly made. The cash books have been cast and all postings... the various ledgers checked ... detail.

All invoices ... respect of goods purchased and expenses incurred have been examined with the appropriate analysis of books, the totals of which have been checked. Several minor errors were detected which have now been rectified. The postings to the Creditors' Ledgers have been test-checked, being far too numerous to do in detail. The balances ... the individual Creditors' accounts have been compared with special audit statements obtained from them and found to be ... order. Our instructions did not require us to examine the Sales Ledgers and Day Books: we therefore report that in such work as we have performed we found no evidence of, or opportunity ... defalcation or fraud.

Words you may need:

voucher n оправдательный денежный документ

authorization of accounts for payment разрешение на осуществление платежей со счетов handling of cash использование наличности

cash balance остаток кассовой наличности cashier's book журнал кассовых операций bank statement выписка из счета

receipt n квитанция

to obtain evidence получить доказательство disbursements n pl выплаты

cash book кассовая книга, журнал кассовых операций cast v подсчитывать, исчислять, подводить итоги posting v проводка

ledger n бухгалтерская книга, бухгалтерский регистр expenses incurred понесенные расходы

detect v обнаруживать rectify v исправлять

Creditors' Ledger книга кредиторов test-check v проверять с помощью тестов audit statement аудиторский отчет

Sales Ledger книга учета продаж

Day Book книга операций рабочего дня defalcation n присвоение чужих денег

fraud n мошенничество, обман

Ex. 10. a) Open the brackets putting the verbs in the correct form, b) Discuss the content of the article.

Misuse of Public Funds

It is a universally accepted truth in Russia that the heads of many public funds habitually (to divert) trillions of rubles away from the stated purpose into lucrative deals for personal gain.

Over the first 10 months of this year, the Accounts Chamber, a watchdog of the State Duma, (to reveal) that nearly 1.8 trillion rubles, were not used for their designated purposes.

The auditors (to find) that nearly every fund was not using its money as it was supposed to. For instance, the Moscow branch of Russia's Pension Fund (to buy) a building for about 2 billion rubles, (to spend) 11.5 billion rubles on its renovation and repair, and (to pay) another 6 billion rubles to an intermediary for "selecting the building, preparing the necessary documents, and obtaining the consent of the parties concerned." The Pension Fund (to misuse) more than 660 billion rubles despite the fact that people in some regions were left without pension payments for up to three months.

Many public funds (to set) up their own banks with charter capital running into hundreds of billions of rubles.

In spite of the obvious violations of regulations, all these operations cannot be put down as embezzlement without court rulings, and the violators are unlikely to be sued.

Misappropriations from extrabudgetary funds (to encourage) not only by people with a particular mentality and by a lack of adequate actions on the part of law-enforcement agencies, but also by the very system through which financial resources (to flow) from top to bottom. State extrabudgetary funds (to act) as an intermediary that collects payments and remits them to the recipients. Thus, they (to tempt) to "invest" the money in lucrative fast-yielding deals.

There would probably have been fewer cases of embezzlement and misuse of assets if public funds had initially been granted legal rights to earn money by, for example, transacting in securities and foreignexchange valuables, and making short-term deposits in banks. So far the funds only (to have) a list of operations barred to them.

Words you may need: misuse n злоупотребление

universally accepted общепринятый habitually adv обычно

divert v отвлекать, отводить

lucrative adj прибыльный, выгодный, доходный personal gain личная выгода

Accounts Chamber Счетная палата

designated purposes указанные (запланированные) цели consent n согласие

violation n нарушение embezzlement n растрата

court ruling постановление суда

sue v искать в суде, преследовать в судебном порядке

misappropriation n незаконное присвоение, растрата remit v переводить (средства)

recipient n получатель

fast-yielding deals сделки, быстро приносящие прибыль valuables n ценности

bar v запрещать

Ex. 11. Fill each gap with a suitable word from the box. Sum up the text in 5-7 sentences and present your

Independent Auditors' Report to the Board of Directors and Stockholders of_______Company

We have audited the consolidated balance sheets of ______ Company and Subsidiaries at December 31, ...

and ... (years) and the related consolidated statements of income, stockholders' equity and cash flows for each of the years in the period ended December 31,... (year).

Respective_______of directors and auditors are as follows: the company directors are responsible for the preparation of financial _______; our responsibility is to form an independent______based on our audit of these statements and to report our opinion to you.

Basis of opinion. We conducted our________in accordance with generally accepted auditing ________ . Our audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgements made by the________in the preparation of the financial statements, and of whether the accounting policies are appropriate to the company's circumstances, consistently applied and adequately disclosed:

We planned and ________ our audit so as to obtain all the information and explanations which we considered________in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are_________from material misstatements, whether caused by fraud or other irregularity or error. In_______ our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements. We believe that our ________provides a reasonable basis for our opinion.

Opinion. In our _______ the financial statements referred to above give a true and fair________ of the consolidated financial position of________Company and Subsidiaries at December 31, ... (year) and have been properly prepared in________with generally accepted accounting principles and the Company Act 1985.

Words you may need:

disclosure n отражение (информации в финансовой отчетности) fraud n обман, мошенничество

DISCUSSION

Ex. 12. a) Read the texts and do the tasks that follow.

b) Describe the two main functions of auditing. Discuss how public accountants (auditors) and government auditors perform these functions. Explain the importance of internal auditing.

a) Audit is an examination of the records and reports of an enterprise by accounting specialists other than

those responsible for their preparation. Public auditing by independent accountants has acquired professional status and become increasingly common with the rise of large business units and the separation of ownership from control. The public accountant performs tests to determine whether the management's statements were prepared in accordance with acceptable accounting principles and fairly present the firm's financial position and operating results. Such independent evaluations of management reports are of interest to actual and prospective shareholders, bankers, suppliers, lessors, and government agencies. Generally speaking, auditing has two functions: to reveal undesirable practices and, as far as possible, to prevent their recurring in the future. A relatively new type of auditing is internal auditing. It is designed to evaluate the effectiveness of a business's accounting system. Perhaps the most familiar type of auditing is the administrative audit, or preaudit, in which individual vouchers, invoices or other documents are investigated for accuracy and proper authorization before they are paid or entered in the books.

In English-speaking countries, public auditors are usually certified, and high standards of professional qualification are encouraged.

Most countries have specific agencies or departments charged with the auditing of their public accounts. Taxpayers in all countries are interested in the sound management of the collected revenue, they also want to know whether or not the executive branch of government is complying with the law, especially in the area of public finance.

Government auditors are working for sound, economical and efficient financial management, addressing the key problems in the field of public sector auditing, like strengthening the institutions that oversee financial management, changes in the scope and methodology of government auditing, ability to conduct performance audits in public enterprises, strengthening internal auditing in spending units, ex-post external audits of government activities, budget efficiency problems, performance of expenditure programmes.

The advantages accruing from an audit are obvious, taking into account the complexity of present-day commerce and business.

c) Read the document below and discuss the results of the audit: Independent Auditor's Report

Dear Sirs,

We have audited the accompanying general purpose financial statements of Cobb County, Georgia, and the combining, individual fund and account group financial statements of Cobb County, Georgia as of and for the year ended September 30, ...

These financial statements are the responsibility of Cobb County, Georgia's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of Cobb County, Georgia at September 30.....and the results of its operations and the cash flows of its proprietary fund types for the year then ended, in conformity with generally

accepted accounting principles. Also, in our opinion, the combining, individual fund and account group financial statements referred to above present fairly, in all material respects, the financial position of each of the individual funds and account groups of Cobb County, Georgia, at September 30, ..., and the results of operations of such funds and the cash flows of individual proprietary funds for the year then ended, in conformity with generally accepted accounting principles.

Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole and on the combining, individual fund and account group financial statements. The accompanying financial information is presented for purposes of additional analysis and is not a required part of the financial statements of Cobb County, Georgia. The information has been subjected to the auditing procedures applied in the audit of the general purpose, combining, individual fund and account group financial statements and, in our opinion is fairly stated in all material respects in relation to the financial statements of each of the respective individual funds and account groups, taken as a whole. Atlanta, Georgia,

January 12,...

Ex. 13. Read the dialogue, sum up its content and act it out:

Foreigner. As far as I know, when you started your economic reforms some people believed that under market conditions the controlling function of the state would be losing its importance. Has this idea proved to be true?

Russian: It's clear now that the idea was erroneous. Results of audits and inspections reveal lots of breaches of the tax law, misuses of public money, misappropriations and numerous cases of budget funds squandering.

F.: How can you account for so numerous financial infringements in Russia now?

R.: The situation we are having now is a consequence of a weak legal base, shortcomings in running the country's finances, absence of a legal base for an active financial control.

F.: What infringements are most frequent?

R.: Well, first of all, I would single out diverting of money away from the stated purposes into lucrative deals for personal gain. I mean funds allocated as returnable resources and budget resources allocated as the state support for different branches of economy. Then I would mention transfer of state funds to commercial units, embezzlements, defalcations, and misappropriation of funds.

F.: We have heard about scandals in your country when managers illegally placed so-called "free money" in commercial banks and used the profit made to satisfy their own needs, like buying cars and real estate, going abroad on holiday and so on.

R.: That's true. In some cases, managers underreport their taxable profit, do not disclose income in accounting documents, start business operations without licenses, avoid paying excise duties, etc. There is no legally established responsibility for the misuse of budget funds, which causes irresponsibility, wastefulness, and criminal actions on the part of senior officials and managers. Do you have similar problems?

F.: Well, yes, we have, but on a smaller scale. There is an efficient system of government auditing in our country. We examine accounting and performance of all government agencies and public corporations. What are the functions of government auditing in Russia?

R.: Generally, we focus on compliance of government agencies, juridical persons with financial legislation

Russia. Consider different aspects of their activities.

READING PRACTICE

Ex. 17. a) Look through the text below to find the names of bodies responsible for continuing professional education in the UK.

b) Read the text carefully to say what CPE implies. Continuing Professional Education

The Audit Registration Committees of the Institutes of Chartered Accountants in Britain are extremely interested in and concerned about continuing professional education (CPE). CPE is essential for all principals and employees who deal with audit work. Indeed, it is more than essential, it is compulsory. It is there to ensure that firms maintain their competence to do audit work and maintain the high professional standards expected of firms of chartered accountants.

Principals and employees must keep up-to-date with changes in company law, accounting and auditing standards, etc.

The amount of CPE is not expressed as an absolute total, but a target of 150 points. One point is given for each "unstructured" hour of CPE (e.g. reading) and three points for each "structured" hour (e.g. course attendance). Of the target of 150 at least 60 points should be structured activities. For auditors, half those amounts (i.e. 75 points of total and 30 points of structured education) should be audit-related. Thirty structured CPE points is, for example, 10 hours of course attendance.

The current system of CPE has been in place since 1991. There are no exemptions due to the age of the practitioner or the volume of audit work undertaken.

The ARCs accept that in any particular year the targets may not be met. It is important that auditing firms should take a conscientious approach to CPE. However, the ARCs are becoming increasingly concerned about firms who have done little, if any, CPE.

In the Committees' view, there is a wealth of CPE available. Courses are run by the institutes, district societies and commercial training organizations. There should be no excuse for not doing CPE. Firms should be aware that ARCs will take a firm line with firms who do inadequate CPE.

Ex. 18. a) Read through the text for general information.

b) Reread the text more carefully and pick out information about the JMU.

The EU 8th Company Law Directive set out the requirements for each member state to have a common minimum regulatory system for auditors of limited companies. The United Kingdom enacted this through the Companies Act 1989 and added a requirement for monitoring. Since 1 October 1991, a firm must be a Registered Auditor to conduct company audit work.

In 1990 the Department of Trade and Industry granted the status of Recognized Supervisory Body to ICAEW, ICAS and ICAI, thus allowing these institutes to register and regulate Registered Auditors. Specifically, this work is done by Audit Registration Committees which register auditors and then organise monitoring.

Monitoring is conducted on behalf of the Institutes by the Joint Monitoring Unit, which was set up in 1987 to monitor the compliance of firms authorized to conduct investment business and whose role was extended in 1991 to include monitoring the work of Registered Auditors.

The monitoring activities of the JMU involve:

• issuing and reviewing firms' Annual Returns,

•conducting visits to firms,

•reporting the results of visits to the ARCs.

Activities of the JMU aim to assess whether or not the firm has complied with Audit Regulations and Standards. The JMU seeks to assist firms by making practical suggestions for improvements of their audit performance.

Words you may need:

Ирландии

BANKING CORRESPONDENCE

Most correspondence in banking is done through letters and telexes, fax messages and SWIFT ones. Special forms are also widely used.

Here is a layout of a typical letter:

Note: Ref means "reference". References are quoted to indicate what a piece of correspondence refers to ("Your ref) and the correspondence to refer to when replying ("Our ref).

Re is a Latin abbreviation of in re which means "the subject title". It is used after the salutation.

p.p is another Latin abbreviation of per pro, which is sometimes used in signatures and means "for and on behalf of.

The following salutations are used in letters: "Dear Sirs", "Dear Sir", "Dear Madam". In the USA a letter may usually open with "Gentlemen:".

message сообщение

SWIFT (Society for Worldwide Interbank Financial Telecommunication) международная организация СВИФТ (основана в 1973 г.)

form бланк

layout (зд.) расположение рубрик (в письме) typical характерный, типичный

sender отправитель reference ссылка, референс receiver получатель salutation приветствие subject title предмет письма body (зд.) текст письма

complimentary close заключительная фраза payment order платежное поручение abbreviation сокращение

to quote приводить, цитировать to indicate указывать

for and on behalf of от имени и по поручению

** *

Correspondence may deal with information about changes in the bank in question (see an example of such letter on p. 340).

to deal (with) иметь дело (с) in question о котором идет речь

correspondent корреспондент; (зд.) банк-корреспондент to announce объявлять

senior старший

effective вступающий в силу to be composed of состоять из division отделение (управление) to amend вносить поправки records документы

in line with в соответствии с department отдел concerned соответствующий

Note: There are a few ways of writing dates at the head of letters and documents. They are as follows:

After a visit to a certain bank a foreign banker usually sends a letter of thanks for hospitality received upon arrival in his country:

The Sanwa Bank Limited INTERNATIONAL HEADQUARTERS 1-1-1, OTEMACH1, CHIYODA-KU TOKYO, 100

Bank for Foreign Economic Affairs

Moscow

Russia

Dear Mr. Ivanov:

Having recently returned to Tokyo I take this first opportunity to thank you for the hospitality you extended to Mr. Nishimura and me when we were honoured to call on your fine institution. I found our meeting and discussion to be fruitful and interesting, certainly assisting us to achieve the objective of our trip.

I very much appreciate your kind suggestion on our providing flexibility of loan facilities. As I explained during our meeting, we shall keep this suggestion in mind under the condition of Japanese financial market. At the same time, we respectfully ask you to consider our sincere proposal that you open a US Dollar account with our bank.

I have heard that Mr. Larin, your Deputy Chairman, will be visiting Japan this autumn.

I look forward to seeing him again and to discussing subjects of mutual interest. In offering kindest personal regards, I look forward to ways of expanding business activities we are privileged to enjoy with your esteemed bank. Please pass on my best wishes to Mr. Radionov, your Deputy General Manager.