Threats Arising from Employment and Other Relationships

Question 1

Examples of employment/other relationships?

Answer 1

Business relationships
Personal relationships
Employment
Long association
Actual/threatened litigation

Question 2

What might a close business relationship with an audit client or management create?

Answer 2

A self-interest or intimidation threat

Question 3

Examples of close business relatiknship threat (Interest)

Answer 3

Holding an interest in a joint venture with a client

Question 4

Examples of close business relatiknship threat (Arrangements)

Answer 4

Arrangements to combine or more products of the firm with one or more services/products of client.

Then market package with reference to both parties

Question 5

Examples of close business relatiknship threat (Distribution)

Answer 5

Distribution of a client’s products/services

Question 6

Examples of close business relatiknship safeguard (Disposal)

Answer 6

Disposal of firm’s interests unless clearly insignificant

Question 7

Examples of close business relatiknship safeguard (Removal)

Answer 7

Removal of any individual audit team member who as an interest from the audit team