THE SOUTHERN AFRICAN JOURNAL OF ACCOUNTABILITY AND AUDITING RESEARCH Volume 2: 1999   Contents of this issue: Seeking a brighter future for auditing in South Africa The problem of pensioners' health care costs Audit materiality: a comparative analysis between normative principles and professional standards Internal control risks within the data warehouse environment The control implications of a public key infrastructure Seeking a brighter future for auditing in South Africa (JD Gloeck & H De Jager) This is a Position Paper on structural reforms in the South African audit industry. This Paper is presented at a time where the existing legislation regarding the auditing industry is being reviewed by a committee consisting of South Africa's Public Protector and a retired judge with a view to producing a Bill to be tabled for approval in Parliament. The authors hereby heed calls made by the drafters of the new statutory framework to present suggestions regarding the transformation of the audit industry in South Africa and addressing existing shortcomings. The authors propose the formation of a new body (or the transformation of the existing Public Accountants' and Auditors' Board) to perform additional functions which would strengthen the statutory framework within which auditors operate. The proposals also discuss and address social priorities and imbalances in South Africa. The problem of pensioners' health care costs (GL Marx) Due to the facts that populations age and that health care costs increase with age, proper long-term planning is needed to fund for pensioners' health care costs. Some employers have promised their employees and former employees subsidies in this regard. However, the long-term costs of these subsidies have not been evaluated and have not been accounted for. Accounting standards, as well as fundamental appreciation of the problem, are now leading to recognition of the liabilities. Both employers and individuals have to take cognisance of the opportunities and threats in addressing it. The purpose of this article is to describe the funding problem of pensioners' health care. In the context of the South African medical schemes industry, these members are comprehensively referred to as "continuation and widow members" (CAWMS). Please note that pensioners refer also to ill-health pensioners. Dependants of deceased members (having died either before or after retirement) are to be treated in the same way as pensioners. [ BACK TO THE TOP ] Audit materiality: a comparative analysis between normative principles and professional standards (WJJ Botha) Audit materiality is a fundamental concept of the external audit process. Guidelines issued by professional standard-setting bodies generally state that the determination of audit materiality is primarily a matter of professional judgment. Overemphasizing professional judgment as predominate guideline might be an attempt to advance and maintain so-called uncertain professional knowledge. This paper examines the proposition that in respect of determining materiality during the audit of company annual financial statements, professional auditing standards suggest the preference of standard-setting bodies not to provide concrete guidelines to the extent it is possible. It does so by means of a comparative analysis between normative principles regarding the determination of audit materiality and the corresponding professional standards. The results provide sufficient evidence to support the research proposition. Audit materiality standards presently have two major shortcomings, namely: overemphasizing the exercise of professional judgment and providing for various alternatives, while normative principles favour a specific approach. Internal control risks within the data warehouse environment (SP de la Rosa & H de Jager) Decision support systems enable management to improve both their strategic and short term decision making processes. An example of a decision support system is the data warehouse. A study of the sufficiency of audit resources relating to the data warehouse was conducted. It is evident that the internal audit profession has been slow in identifying the specific internal control risks relating to such an environment. With this in mind, we undertook a study to determine the nature of the specific internal control risks within the data warehouse environment. The study also provides a brief insight into what future trends and developments can be expected within the data warehouse environment. The effect that such enhancements could have on the internal auditor's assessment of internal control risk were also noted. The control implications of a public key infrastructure (A Bouwer) Organisations continuously have to question traditional thinking and implement state of the art systems to control e-commerce applications. A Public Key Infrastructure (PKI) has established itself as the generally accepted method to control e-commerce transactions. This infrastructure comprises complex technology supported by specific manual and electronic control procedures. In the e-commerce realm, auditing professionals are increasingly challenged with new technologies and different methodologies such as PKI. This article examines the inherent risks associated with implementing a PKI and gives guidance on control appropriate control measures. 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