Intimidation threat a. Is not a threat to independence. b. Occurs when a member of the assurance team may be deterred from acting objectively and exercising professional skepticism by threats, actual or perceived, from the directors, officers or employees of an assurance clienc. Occurs when, by virtue of a close relationship with an assurance client, its directors, officers or employees, a firm or a member of the assurance team becomes too sympathetic to the client's interests. d. Occurs when a firm, or a member of the assurance team, promotes, or may be perceived to promote, an assurance client's position or opinion to the point that objectivity may, or may be perceived to be, compromised.t

Question

Intimidation threat a. Is not a threat to independence. b. Occurs when a member of the assurance team may be deterred from acting objectively and exercising professional skepticism by threats, actual or perceived, from the directors, officers or employees of an assurance clienc. Occurs when, by virtue of a close relationship with an assurance client, its directors, officers or employees, a firm or a member of the assurance team becomes too sympathetic to the client's interests. d. Occurs when a firm, or a member of the assurance team, promotes, or may be perceived to promote, an assurance client's position or opinion to the point that objectivity may, or may be perceived to be, compromised.t

Intimidation threat
a. Is not a threat to independence.
b. Occurs when a member of the
assurance team may be deterred
from acting objectively and
exercising professional skepticism
by threats, actual or perceived, from
the directors, officers or employees
of an assurance client
c. Occurs when, by virtue of a close
relationship with an assurance client, its
directors, officers or employees, a firm or
a member of the assurance team
becomes too sympathetic to the client's
interests.
d. Occurs when a firm, or a member of the
assurance team, promotes, or may be
perceived to promote, an assurance
client's position or opinion to the point
that objectivity may, or may be
perceived to be, compromised.

asked Nov 3, 2021 by shubhhw

1 Answer

Related questions

Occurs when, by virtue of a close relationship with an assurance client, its directors, officers or employees, a firm or a member of the assurance team becomes too sympathetic to the client's interests. a. Self-interest threat b. Self-review threat c. Advocacy threat d. Familiarity threat

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Last Answer : Familiarity threat

A director, an officer or an employee of the assurance client in a position to exert direct and significant influence over the subject matter of the assurance engagement has been a member of the assurance team or partner of the firm. This situation least likely create a. Self-interest threat. b. Advocacy threat. c. Intimidation threat. d. Familiarity threat

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Last Answer : Advocacy threat.

Family and personal relationships between a member of the assurance team and a director, an officer or certain employees, depending on their role, of the assurance client, least likely create a. Self-review threat. b. Self-interest threat. c. Intimidation threat. d. Familiarity threat

Description : Family and personal relationships between a member of the assurance team and a director, an officer or certain employees, depending on their role, of the assurance client, least likely create a. Self-review threat. b. Self-interest threat. c. Intimidation threat. d. Familiarity threat

Last Answer : Self-review threat.

Examples of circumstances that may create familiarity threat least likely include a. A member of the assurance team having an immediate family member or close family member who is a director or officer of the assurance client. b. A member of the assurance team having an immediate family member or close family member who, as an employee of the assurance client, is in a position to exert direct and significant influence over the subject matter of the assurance engagement. c. A former partner of the firm being a director, officer of the assurance client or an employee in a position to exert direct and significant influence over the subject matter of the assurance engagement. d. Dealing in, or being a promoter of, share or other securities in an assurance client

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Last Answer : Dealing in, or being a promoter of, share or other securities in an assurance client

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Last Answer : Dealing in, or being a promoter of, share or other securities in an assurance client

A former officer, director or employee of the assurance client serves as a member of the assurance team. This situation will least likely createa. Self-interest threat.b. Self-review threat.c. Intimidation threat.d. Familiarity threa

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Last Answer : Intimidation threat

A former officer, director or employee of the assurance client serves as a member of the assurance team. This situation will least likely create a. Self-interest threat. b. Self-review threat. c. Familiarity threat. d. Intimidation threat.

Description : A former officer, director or employee of the assurance client serves as a member of the assurance team. This situation will least likely create a. Self-interest threat. b. Self-review threat. c. Familiarity threat. d. Intimidation threat.

Last Answer : Intimidation threat.

The provision of services by a firm or network firm to an audit client that involve the design and implementation of financial information technology systems that are used to generate information forming part of a client's financial statements may most likely create a. Self-interest threat. b. Self-review threat. c. Intimidation threat. d. Familiarity threat

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Which of the following is not likely a threat to independence? a. Acting as an advocate on behalf of an assurance client in litigation or in resolving disputes with third parties. b. Long association of a senior member of the assurance team with the assurance client. c. Threat of replacement over a disagreement with the application of an accounting principle. d. Owning immaterial indirect financial interest in an audit client.

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Last Answer : Owning immaterial indirect financial interest in an audit client.

Which of the following is not likely a threat to independence? a. Acting as an advocate on behalf of an assurance client in litigation or in resolving disputes with third parties. b. Long association of a senior member of the assurance team with the assurance client. c. Threat of replacement over a disagreement with the application of an accounting principle. d. Owning immaterial indirect financial interest in an audit client.

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Last Answer : Owning immaterial indirect financial interest in an audit client.

Examples of circumstances that may create self-interest threat include: a. Contingent fees relating to assurance engagements. b. A direct financial interest or material indirect financial interest in an assurance client. c. A loan or guarantee to or from an assurance client or any of its directors or officers. d. All of the above

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Last Answer : All of the above

Examples of circumstances that may create self-interest threat include: a. Contingent fees relating to assurance engagements. b. A direct financial interest or material indirect financial interest in an assurance client. c. A loan or guarantee to or from an assurance client or any of its directors or officers. d. All of the above

Description : Examples of circumstances that may create self-interest threat include: a. Contingent fees relating to assurance engagements. b. A direct financial interest or material indirect financial interest in an assurance ... an assurance client or any of its directors or officers. d. All of the above

Last Answer : All of the above

It occurs when a firm or a member of the assurance team could benefit from a financial interest in, or other self-interest conflict with, an assurance client. a. Self-interest threat b. Self-review threat c. Advocacy threat d. Familiarity threa

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Last Answer : Self-interest threat

Examples of circumstances that may create self-review threat least likely include a. Potential employment with an assurance client. b. Preparation of original data used to generate financial statements or preparation of other records that are the subject matter of the assurance engagement. c. A member of the assurance team being, or having recently been, an employee of the assurance client in a position to exert direct and significant influence over the subject matter of the assurance engagement. d. Performing services for an assurance client that directly affect the subject matter of the assurance engagemen

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Which of the following most completely describes how independence has been defined by the CPA profession? a. Performing an audit from the viewpoint of the public. b. Avoiding the appearance of significant interests in the affairs of an audit client. c. Possessing the ability to act with integrity and objectivity. d. Possessing the ability to act professionally and accordance with a professional code of ethics.

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A CPA firm is considered independent when it performs which of the following services for a publicly traded audit client? a. Serving as a member of the client’s board of directors. b. Accounting information system design and implementation. c. Tax return preparation as approved by the board of directors. d. Determining which accounting policies will be adopted by the client

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A CPA firm is considered independent when it performs which of the following services for a publicly traded audit client? a. Serving as a member of the client’s board of directors. b. Accounting information system design and implementation. c. Tax return preparation as approved by the board of directors. d. Determining which accounting policies will be adopted by the client

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A CPA firm is considered independent when it performs which of the following services for a publicly-traded audit client? a. Serving as a member of the client's board of directors. b. Determining which accounting policies will be adopted by the client. c. Accounting information system design and implementation. d. Tax return preparation as approved by the board of directors.

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Last Answer : Tax return preparation as approved by the board of directors.

What is the most likely course of action that will be taken by an auditor in assessing management integrity? a. Tour the client premises. b. Research the prospective client’s related parties. c. Research the background and histories of officers d. Review the minutes of the board of directors

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When an auditor believes that an understanding with the client has not been established, he or she should ordinarily a. Perform the audit with increased professional skepticism. b. Decline to accept or perform the audit. c. Review the client’s financial reports. d. Obtain information about the client’s business and the industry where it operates

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Which of the following matters would an auditor least likely consider when setting the direction of the audit? a. The selection of the engagement team and the assignment of audit work to the team members. b. The engagement budget which includes consideration of the appropriate amount of time to allot for areas where there may be higher risks of material misstatement. c. The availability of client personnel and data. d. The manner in which the auditor emphasizes to engagement team members the need to maintain a questioning mind and to exercise professional skepticism in the gathering and evaluation of audit evidence.

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Last Answer : The availability of client personnel and data

Which of the following is an indication of lack of objectivity of an auditor? a. The auditor believes that accounts receivable may not be collectible, but accepts management's opinion without an independent evaluation. b. In preparing client's tax return, the CPA encourages client to take a deduction which the CPA believes is valid, but for which there is some but not complete support. c. Both a and b above would be a violation d. Neither would be a violation

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Last Answer : The auditor believes that accounts receivable may not be collectible, but accepts management's opinion without an independent evaluation.

If a member of the assurance team, or their immediate family member receives, by way of, for example, an inheritance, gift or, as a result of a merger, a direct financial interest or a material indirect financial interest in the assurance client, a self-interest threat would be created. The following safeguards should be applied to eliminate the threat or reduce it to an acceptable level: a. Disposing of the financial interest at the earliest practical date. b. Removing the member of the assurance team from the assurance engagement. c. Either a or b d. Neither a nor b

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Last Answer : Either a or b

How did the Code of Ethics define public interest? a. A distinguishing mark of a profession is the acceptance of its responsibility to the public. b. The accountancy profession's public consists of clients, credit grantors, governments, employers, employees, investors, the business and financial community, and others who rely on the objectivity and integrity of professional accountants. c. The collective well-being of the community of people and institutions the professional accountant serves. d. The standards of the accountancy profession are heavily determined by the public interest

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Last Answer : The collective well-being of the community of people and institutions the professional accountant serves.

Which of the following least likely create "self-interest threat"? a. Undue dependence on total fees from an assurance client. b. Concern about the possibility of losing the engagement. c. Having a close business relationship with an assurance client. d. Pressure to reduce inappropriately the extent of work performed in order to reduce fees

Description : Which of the following least likely create "self-interest threat"? a. Undue dependence on total fees from an assurance client. b. Concern about the possibility of losing the engagement. c. Having ... client. d. Pressure to reduce inappropriately the extent of work performed in order to reduce fees

Last Answer : Pressure to reduce inappropriately the extent of work performed in order to reduce fees

Safeguards that may eliminate or reduce threats to independence to an acceptable level fall in the following categories except: a. Safeguards created by the profession, legislation or regulation b. Firm-wide safeguards c. Engagement specific safeguards d. Safeguards created by the client

Description : Safeguards that may eliminate or reduce threats to independence to an acceptable level fall in the following categories except: a. Safeguards created by the profession, legislation or regulation b. Firm-wide safeguards c. Engagement specific safeguards d. Safeguards created by the client

Last Answer : Safeguards created by the client

Which of the following is a distinguishing mark of the accountancy profession? a. A drive to excellence b. Acceptance of the responsibility to act in the public interest c. Professional objectivity d. Professional skepticism

Description : Which of the following is a distinguishing mark of the accountancy profession? a. A drive to excellence b. Acceptance of the responsibility to act in the public interest c. Professional objectivity d. Professional skepticism

Last Answer : Acceptance of the responsibility to act in the public interest

An auditor obtains an understanding of the entity and its environment in order to a. Make constructive suggestions concerning improvements to the client's internal control. b. Understand the events and transactions that may have an effect on the client's financial statements. c. Evaluate whether the aggregation of known misstatements causes the financial statements taken as a whole to be materially misstated. d. Develop an attitude of professional skepticism concerning management's financial statement assertion

Description : An auditor obtains an understanding of the entity and its environment in order to a. Make constructive suggestions concerning improvements to the client's internal control. b. ... misstated. d. Develop an attitude of professional skepticism concerning management's financial statement assertion

Last Answer : Understand the events and transactions that may have an effect on the client's financial statements

In pursuing its quality control objectives with respect to assigning personnel to engagements, a public accounting firm may use policies and procedures such as a. Rotating employees from assignment to assignment on a random basis to aid in the staff training effort. b. Allowing staff to select the assignments of their choice to promote better client relationships. c. Assigning a number of employees to each engagement in excess of the number required so as not to overburden the staff, and interfere with the quality of the audit work performed. d. Requiring timely identification of the staffing requirements of specific engagements so that enough qualified personnel can be made available

Description : In pursuing its quality control objectives with respect to assigning personnel to engagements, a public accounting firm may use policies and procedures such as a. Rotating employees from ... the staffing requirements of specific engagements so that enough qualified personnel can be made available

Last Answer : Requiring timely identification of the staffing requirements of specific engagements so that enough qualified personnel can be made available

To emphasize auditor independence from management, many corporations follow the practice of a. Appointing a partner of the CPA firm conducting the examination to the corporation's audit committee. b. Establishing a policy of discouraging social contact between employees of the corporation and the staff of the independent auditor. c. Requesting that a representative of the independent auditor be on hand at the annual stockholders' meeting. d. Having the independent auditor report to an audit committee of outside members of the board of directors

Description : To emphasize auditor independence from management, many corporations follow the practice of a. Appointing a partner of the CPA firm conducting the examination to the corporation's audit committee. b ... the independent auditor report to an audit committee of outside members of the board of directors

Last Answer : Having the independent auditor report to an audit committee of outside members of the board of directors

No matter competent a CPA may be, his opinion on financial statements will be of little value to those who rely upon him unless he: a. Maintains his independence. b. Maintains professional competence. c. Maintains a program of continuing education. d. Serves his clients with professional concern.

Description : No matter competent a CPA may be, his opinion on financial statements will be of little value to those who rely upon him unless he: a. Maintains his independence. b. Maintains professional competence. c. Maintains a program of continuing education. d. Serves his clients with professional concern.

Last Answer : Maintains his independence

Which of the following best describes why publicly-traded corporations follow the practice of having the outside auditor appointed by the board of directors or elected by the stockholders? a. To comply with the regulations of the Accounting Standards Council. b. To emphasize auditor independence from the management of the corporation. c. To encourage a policy of rotation of the independent auditors. d. To provide the corporate owners with an opportunity to voice their opinion concerning the quality of the auditing firm selected by the director

Description : Which of the following best describes why publicly-traded corporations follow the practice of having the outside auditor appointed by the board of directors or elected by the stockholders? a. ... opportunity to voice their opinion concerning the quality of the auditing firm selected by the director

Last Answer : To emphasize auditor independence from the management of the corporation

Which of the following is a violation of the code of professional ethics for certified public accountants? a. A CPA permits his/her name to be used in a client's advertising as having verified financial data and/or statistical facts with respect to the client's products. b. Based on information obtained in an audit, a CPA reports an illegal act of his client to government authorities. c. Three years after a partner has retired, the remaining partners continue to practice under a firm name that includes the name of the retired partner. The retired partner has severed all connections with the CPA firm. d. A CPA running for public office uses the professional designation "CPA" after his name on posters employed in connection with his election campaign

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Last Answer : Based on information obtained in an audit, a CPA reports an illegal act of his client to government authorities.

A member in public practice may perform for a contingent fee any professional services for a client for whom the member or member's firm performs a. An audit. b. A review. c. A compilation used only by management. d. An audit of prospective financial information

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A member in public practice may perform for a contingent fee any professional services for a client for whom the member or member's firm performs a. An auditb. A review. c. A compilation used only by management. d. An audit of prospective financial information..

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Last Answer : A compilation used only by management.

The practitioner makes a critical assessment of validity of audit evidence, with a questioning mind and being alert to conditions which may indicate possible misstatement due to error or fraud. a. Objectivity and integrity b. Professional c. Independence is mental attitude d. Sufficient appropriate evidence

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Last Answer : Professional skepticism

Which of the following partners is least likely to be considered a "covered member" for purposes of rendering assurance service to of Company A, a nonaudit client, performed by the head office of a national CPA firm? a. The partner in charge of the Davao office. b. The partner in charge of the entire CPA firm. c. A partner in the Cebu office of the CPA firm who maintains a small, immaterial investment in Company A. d. A partner in the Davao office who worked on the Company A for a different assurance engagement in previous years, but currently has no responsibilities with respect to the engagement

Description : Which of the following partners is least likely to be considered a "covered member" for purposes of rendering assurance service to of Company A, a nonaudit client, performed by the ... assurance engagement in previous years, but currently has no responsibilities with respect to the engagement

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Which of the following partners is least likely to be considered a "covered member" for purposes of rendering assurance service to of Company A, a nonaudit client, performed by the head office of a national CPA firm? a. The partner in charge of the Davao office. b. The partner in charge of the entire CPA firm. c. A partner in the Cebu office of the CPA firm who maintains a small, immaterial investment in Company A. d. A partner in the Davao office who worked on the Company A for a different assurance engagement in previous years, but currently has no responsibilities with respect to the engagement

Description : Which of the following partners is least likely to be considered a "covered member" for purposes of rendering assurance service to of Company A, a nonaudit client, performed by the ... assurance engagement in previous years, but currently has no responsibilities with respect to the engagement

Last Answer : A partner in the Cebu office of the CPA firm who maintains a small, immaterial investment in Company A.

There are fundamental principles that the professional accountant has to observe when performing assurance engagements. The requirement of which principle is of particular importance in an assurance engagement in ensuring that the conclusion of the professional accountant has value to the intended user? a. Integrity b. Confidentiality c. Professional competence d. Objectivity

Description : There are fundamental principles that the professional accountant has to observe when performing assurance engagements. The requirement of which principle is of particular importance in an assurance ... the intended user? a. Integrity b. Confidentiality c. Professional competence d. Objectivity

Last Answer : Objectivity

The confidential relationship will be violated if, without client's permission, the CPA provides working papers about client to a. A court of law which subpoenas them. b. Another CPA firm as part of a peer review. c. Another CPA firm which has just purchased the CPA's entire practice. d. An investigative or disciplinary body which is conducting a review of the CPA's practice.

Description : The confidential relationship will be violated if, without client's permission, the CPA provides working papers about client to a. A court of law which subpoenas them. b. Another CPA firm as part ... . d. An investigative or disciplinary body which is conducting a review of the CPA's practice.

Last Answer : Another CPA firm which has just purchased the CPA's entire practice.

Which of the following is not required by PSA No. 315, "Consideration of Fraud in a Financial Statement Audit"? a. Conduct a continuing assessment of the risks of material misstatement due to fraud throughout the audit. b. Conduct a discussion by the audit team of the risks of material misstatement due to fraud. c. Conduct inquiries of the audit committee as to their views about the risks of fraud and their knowledge of any fraud or suspected fraud. d. Conduct the audit with professional skepticism, which includes an attitude that assumes balances are incorrect until verified by the audito

Description : Which of the following is not required by PSA No. 315, "Consideration of Fraud in a Financial Statement Audit"? a. Conduct a continuing assessment of the risks of material ... professional skepticism, which includes an attitude that assumes balances are incorrect until verified by the audito

Last Answer : Conduct the audit with professional skepticism, which includes an attitude that assumes balances are incorrect until verified by the audito

In pursuing a CPA firm's quality control objectives, a CPA firm may maintain records indicating which partners or employees of the CPA firm were previously employed by the CPA firm's clients. Which quality control element would this be most likely to satisfy? a. Monitoring. b. Human resources. c. Ethical requirements. d. Engagement performance

Description : In pursuing a CPA firm's quality control objectives, a CPA firm may maintain records indicating which partners or employees of the CPA firm were previously employed by the CPA firm's clients. Which ... to satisfy? a. Monitoring. b. Human resources. c. Ethical requirements. d. Engagement performance

Last Answer : Ethical requirements.

Which of the following statements concerning a CPA's disclosure of confidential client information is ordinarily correct? a. Disclosure should not be made even if such disclosure will protect the CPA's professional interests in legal proceedings. b. Disclosure should be made only if there is a legal, or professional duty to make the disclosure. c. Disclosure may be made to any party on consent of the client. d. Disclosure may be made to any government agency without subpoena.

Description : Which of the following statements concerning a CPA's disclosure of confidential client information is ordinarily correct? a. Disclosure should not be made even if such disclosure will protect the CPA's ... consent of the client. d. Disclosure may be made to any government agency without subpoena.

Last Answer : Disclosure may be made to any party on consent of the client.

.If a professional accountant is billing an audit client a number of hours greater than those actually worked, which of the following fundamental principles is likely violated? a. Objectivity b. Integrity c. Professional due care d. Confidentiality

Description : If a professional accountant is billing an audit client a number of hours greater than those actually worked, which of the following fundamental principles is likely violated? a. Objectivity b. Integrity c. Professional due care d. Confidentiality

Last Answer : Integrity

Which fundamental principle is seriously threatened by an engagement that is compensated based on the net proceeds on loans received by the client from a commercial bank? a. Integrity b. Objectivity c. Professional behavior d. Confidentiality

Description : Which fundamental principle is seriously threatened by an engagement that is compensated based on the net proceeds on loans received by the client from a commercial bank? a. Integrity b. Objectivity c. Professional behavior d. Confidentiality

Last Answer : Objectivity

The term professional accountant in public practice includes the following, except: a. A sole proprietor providing professional services to a client. b. Each partner or person occupying a position similar to that of a partner staff in a practice providing professional services to a client. c. Professional accountants employed in the public sector having managerial responsibilities. d. A firm of professional accountants in public practice

Description : The term professional accountant in public practice includes the following, except: a. A sole proprietor providing professional services to a client. b. Each partner or person occupying a ... public sector having managerial responsibilities. d. A firm of professional accountants in public practice

Last Answer : Professional accountants employed in the public sector having managerial responsibilities

In which circumstance is a CPA firm's independence most likely to be impaired? a. An individual on the audit has a close relative who is a receptionist for the client. b. The father of the audit senior holds a material financial interest in the client of which the senior is unaware. c. The spouse of a staff member on the audit has an immaterial common stock investment in the audit client. d. The partner in charge of the office's compensation is affected by office profitability, a portion of which arises from this audit

Description : In which circumstance is a CPA firm's independence most likely to be impaired? a. An individual on the audit has a close relative who is a receptionist for the client. b. The father of ... of the office's compensation is affected by office profitability, a portion of which arises from this audit

Last Answer : The spouse of a staff member on the audit has an immaterial common stock investment in the audit client

In which circumstance is a CPA firm's independence most likely to be impaired? a. An individual on the audit has a close relative who is a receptionist for the client. b. The father of the audit senior holds a material financial interest in the client of which the senior is unaware. c. The spouse of a staff member on the audit has an immaterial common stock investment in the audit client. d. The partner in charge of the office's compensation is affected by office profitability, a portion of which arises from this audit.

Description : In which circumstance is a CPA firm's independence most likely to be impaired? a. An individual on the audit has a close relative who is a receptionist for the client. b. The father of ... of the office's compensation is affected by office profitability, a portion of which arises from this audit.

Last Answer : The spouse of a staff member on the audit has an immaterial common stock investment in the audit client.

Which of the following statements is true? a. Assurance engagements do not require independence. b. The term “auditor” is broader in scope compared to the term “practitioner.” c. Assurance engagements performed by professional accountants are intended to enhance the credibility of information. d. The degree or level of assurance that may be provided by the practitioner is inversely related to the scope of procedures performed and their results

Description : Which of the following statements is true? a. Assurance engagements do not require independence. b. The term auditor is broader in scope compared to the term practitioner. c. Assurance ... be provided by the practitioner is inversely related to the scope of procedures performed and their results

Last Answer : Assurance engagements performed by professional accountants are intended to enhance the credibility of information.

The network firms are required to be independent of the client a. For assurance engagements provided to an audit client. b. For assurance engagements provided to clients that are not audit clients, when the report is not expressly restricted for use by identified users. c. For assurance engagements provided to clients that are not audit clients, when the assurance report is expressly restricted for use by identified users. d. All of the above

Description : The network firms are required to be independent of the client a. For assurance engagements provided to an audit client. b. For assurance engagements provided to clients that are not audit clients, ... the assurance report is expressly restricted for use by identified users. d. All of the above

Last Answer : For assurance engagements provided to an audit client

shubhhw · Answer 1 · 2021-11-03T16:27:27+0000

Occurs when a member of the
assurance team may be deterred
from acting objectively and
exercising professional skepticism
by threats, actual or perceived, from
the directors, officers or employees
of an assurance client.

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