ISA 250 “Consideration of laws and regulations in an audit of Financial Statement” states that it the responsibility of management, with the oversight of Those Charged With Governance, to ensure that the entity’s operation are conducted in accordance with the provisions of laws and regulations.
For this purpose management may apply the following procedures:
- monitoring legal requirements and ensuring that operating procedures are designed to meet these requirements.
- Instituting and operating appropriate systems of internal control
- Developing, publicizing and following a code of conduct.
- Ensuring employees are properly trained and understand the code of conduct.
- Monitoring compliance with the code of conduct and acting appropriately to discipline employees who fall to comply with it.
- Engaging legal advisors to assist in monitoring legal requirements.
- Maintaining register of significant laws and regulations with which the entity has to comply within its particular industry and a record of complaints.