Chapter 4 - Ethics and acceptance

Question 1

what are the preconditions for an audit required by ISA 210 ?

Answer 1

The auditor must determine the financial reporting framework to be applied in the preparation of the FS is acceptable

Obtain the agreement of management that is acknowledges and understands its responsibilities for:

Preparing the FS in accordance with the applicable financial reporting framework

Internal controls are in place

The client provides the auditor with access to the information for the audit

Question 2

Fundamental ethical principles

Answer 2

PIPCO
Integrity
Objectivity
Professional competence and due care
Confidentiantilty
Professional behaviour

Question 3

Threat to independence

Answer 3

ASSIF
Self-interest
Familiarity
self-review
Advocacy
Intimidation

Question 4

Disclosure of confidential information should only be made if:

Answer 4

Permitted by law and authorised by the client
Required by law
Professional duty or right to disclose

Question 5

Considerations before taking on an audit client

Answer 5

PRIOR
Prior Audit (obtain professional clearance from the previous auditor)
Resources and experience that are available for the audit engagement team
Integrity of management
objective/independence/conflicts of interest
Risk