Threats Arising from Employment and Other Relationships (3)

Question 1

Safeguards for close family (Restructure)

Answer 1

Restructure the audit team’s responsibilities so audit team member doesn’t deal with close family member

Question 2

Safeguards for close family (Remove)

Answer 2

Remove the individual from the audit team

Question 3

What happens with relationships of partners and employees of the firm?

Answer 3

Partners and employees of firm shall consult in accordance with firm policies and procedures if they’re aware of a personal/family relationship

Question 4

What happens with relationships of partners and employees of the firm threat (audit)

Answer 4

A partner of employee of firm who is not an audit member

Question 5

What happens with relationships of partners and employees of the firm threat (director)

Answer 5

A director/officer of audit client an an employee of audit client in a position to exert significant influence over preparation of client’s accounting records

Question 6

What happens with relationships of partners and employees of the firm safeguards (structure)

Answer 6

Structure the partner’s/employee’s responsibilities to reduce potential influence over audit engagement

Question 7

What happens with relationships of partners and employees of the firm safeguards (review)

Answer 7

Review of audit work by appropriate reviewer