Threats Arising from Financial Matters (3) Flashcards
1
Q
What might fees create?
A
A self-interest or intimidation threat
2
Q
What happens when total fees generated frpm an audit client represents a large proportion of the total fees of that firm?
A
The dependence on that cleint and concern about losing the client create a self-interest or intimidation threat
3
Q
Safeguards to relative size (dependence)?
A
Increase audit firm’s client base to reduce dependence on the client
4
Q
Safeguards to relative size (committee)?
A
Discuss with audit committee
5
Q
Safeguards to relative size (resign)?
A
Resign from some services
6
Q
Safeguards to relative size (external)?
A
External quality review
7
Q
Safeguards to relative size (consult)?
A
Consult ACCA or another professional accountant on key audit areas requiring judgement
