How are the ASB Ethical Standards lessening the expectations gap?

Research studies have shown and confirmed that there is a
gap between the expectations of the public and financial statements users and the
expectations of auditors. The gap includes a difference in expectations regarding the
responsibilities of the auditor. Studies show that investors have high expectations of
what the audit and auditor can achieve and assure, while auditors have lessened
expectations of what the audit can achieve and assure.

The
ABS (Accounting Board Standards) ethical standard requires ethical values like title="APB Ethical Standard, "Integrity, Objectivity and
Independence""
href="http://www.frc.org.uk/images/uploaded/documents/ES1%20-%20v5%20clean.pdf">
integrity, objectivity and independence, which are projected as means by which
the expectations gap can be lessened.

Financial statements
are used by many people from suppliers to investors to banks for making financial
decisions relevant to the financial condition of entities. The primary purpose of a
financial statement is to provide the owners (e.g., stock holders) and financial
statement users of the financial entity with information on the state of affairs and
performance of the entity and to assist in assessing the stewardship of chief officers
and directors who are stewards of the entity the are entrusted
with.

The ethical values like integrity and objectivity
ensure that the auditor will provide thorough and honest unbiased information about the
state of affairs of the entity. While the ethical value of independence ensures that the
auditor will remain free of outside opinion, coercion or duress that might sway and
compromise the audit in any one person's or group's favor. Integrity enters in again to
ensure that the auditor won't yield to unethical and dishonest requests for the sake of
personal gain.

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In 1988, the American Institute of
Certified Public Accountant's (AICPA) Committee, the Auditing Standards Board (ASB),
sought to reduce the expectation gap with a series of Statements on Auditing Standards
(SASs), SAS No. 53 through SAS No. 61, collectively referred to as the "expectation gap"
SASs. ( href="http://www.allbusiness.com/accounting-reporting/auditing/833216-1.html">Auditors'
and Investors' Perceptions of the "Expectation Gap" by Stanley C. Martens.
2001.)