You have commenced work as a graduate auditor with a well established audit firm. The firm has a wide client base, which includes some of the largest companies in the state. While the firm derives the major part of its fee revenue from undertaking statutory audits, it also provides other assurance services, including compliance audits. Recently, one of the partners attended a professional function at which it was suggested that a new avenue of work may open up for established audit firms through undertaking external audits under S73 and S74 of the National Greenhouse and Energy Reporting Act 2007. Consequently, she asked you and a colleague to prepare a briefing paper on the issue. You and your colleague agreed that he would undertake the initial research, and that you would undertake follow up research and write the paper. Your colleague was aware that the Department for Climate Change had recently circulated a discussion paper on the subject. He downloaded a copy of the paper and also submissions on the issue from CPA Australia and the Institute of Chartered Accountants in Australia, the Group of 100, the Australian Compliance Institute, and the Australian Petroleum Production and Exploration Association Limited. Your colleague also suggested that you would find some useful material in Chapters 1, 3, 14 and 17 of the textbook he used at university, "Auditing and Assurance Services in Australia" by Gay and Simnett, revised third edition, 2007.
Prepare a briefing paper on the issues facing established audit firms, such as the one you work for, which may wish to undertake external audits under S73 and S74 the National Greenhouse and Energy Reporting Act 2007.