Page 165 - SUSTAINABILITY ISSUES & COVID-19

c. Responsibility
Companies must comply with statutory regulations and carry out responsibility for the community and the
environment so that long-term business continuity can be maintained and be recognized as Good Corporate
Citizen CSR (Corporate Social Responsibility) and compliance (compliance) with laws and regulations.
d. Independency
To facilitate the implementation of GCG principles, the company must be managed independently so that
each organ of the company does not dominate each other and cannot be intervened by other parties. There
are 2 indicators to assess company independence, namely internal and external influences.
e. Equality and Fairness
In carrying out its activities, the company must always pay attention to the interests of shareholders, other
stakeholders and all people involved in it based on the principles of equality and fairness. To assess equality
and fairness that occurs in a company, there are 2 indicators that can be seen, namely shareholders and
stakeholders.

2.3 Audit Standards
Auditing Standards (“SA”) are part of the Public Accountants Professional Standards (SPAP) which govern the specific
responsibilities of auditors in observing quality control procedures for auditing financial statements. Broadly speaking,
SA is divided into several categories, namely, general principles and responsibilities, risk assessment and response to
assessed risk, audit evidence, use of the work of other parties, audit conclusions and reporting, and special areas. The
SAs are then described in more detail with the Standard Audit Statement 200-810 which is divided according to their
respective categories. With the implementation of the SA, the auditors are expected to provide quality audit reports
that prioritize audit quality in accordance with SPM 1.

2.4 Quality Control System
Quality Control System (SPM) referred to in this study is the audit quality control system at the Public Accounting Firm.
SPM is a series of processes to provide adequate assurance to users of financial statements that auditors have complied
with applicable professional standards and company quality standards. In other words, SPM provides protection to
auditors in order to avoid the threat of administrative and legal sanctions if it is found that the auditors fail to provide
quality audit reports or are not in accordance with their conditions.

The current SPM 1 is the adoption of ISQC 1 which is effective starting January 1, 2013. If we look at the structure of
SPAP 2013, SPM 1 has an important role, which is in second place after the code of ethics which is the basis for quality
control. Every personnel at KAP has the responsibility to run and maintain a quality control system in order to achieve
the expected goals of SPM 1.

In its application, SPM is unique because it takes into account the organizational structure, size, policies and procedures
of the Public Accounting Firm. Thus, the SPM applied by large KAP, medium KAP and small KAP will be different. This is
of course because the organizational structure of the small KAP is simpler than the organizational structure of the other
larger KAP because the processes and procedures that are owned by the small KAP are simpler in achieving its goals,
besides that the communication culture in the small KAP is generally informal.

In general, SPM 1 applies to all KAPs that perform assurance engagements and engagements other than assurance. The
application of SPM 1 is carried out by understanding all the provisions of SPM 1 and then developed and elaborated
in the form of policies and procedures in accordance with the size, operating characteristics, and complexity of the
organizational structure of the KAP. The company must also consider the impact of the established procedural policies
whether there are certain problems or circumstances that cause the company to design policies and procedures other
than those requested by ISQC to fulfill stated objectives. Therefore, the determination of SPM for small KAP can be
implemented proportionally considering that some provisions in SPM 1 are irrelevant or cannot be applied to small
KAP SPM.

164 International Conference on Sustainability
(5 Sustainability Practitioner Conference)
Th