During the external audit of Sun Enterprises, Inc. a senior audit staff associate approaches you, as...
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During the external audit of Sun Enterprises, Inc. a senior audit staff associate approaches you, as the audit manager with responsibility for day-to-day operations of the engagement and advises that she has been approached by the audit client with respect to filling a current vacancy for head of the Internal Audit Department. In response to this, and following a conversation with the partner with overall responsibility for the audit, the decision is made to remove the audit senior from the audit and reassign her to a different client. Which of the following best describes the reasoning that underpins this decision? To avoid situations where a CPAS integrity or objectivity may be compromised, which would impair the auditors credibility and independence. O The auditors objectivity and independence are immediately considered impaired, and thus the associate should be immediately removed from the engagement. O When an audit firm employee is offered unemployment with a potential client, the audit firm may be able to take advantage of access to information that they otherwise would not have had. O This employment offer represents a threat to the audit in the sense that the audit associate may now be more lenient to the client and overlook areas of audit concern. During the external audit of Sun Enterprises, Inc. a senior audit staff associate approaches you, as the audit manager with responsibility for day-to-day operations of the engagement and advises that she has been approached by the audit client with respect to filling a current vacancy for head of the Internal Audit Department. In response to this, and following a conversation with the partner with overall responsibility for the audit, the decision is made to remove the audit senior from the audit and reassign her to a different client. Which of the following best describes the reasoning that underpins this decision? To avoid situations where a CPAS integrity or objectivity may be compromised, which would impair the auditors credibility and independence. O The auditors objectivity and independence are immediately considered impaired, and thus the associate should be immediately removed from the engagement. O When an audit firm employee is offered unemployment with a potential client, the audit firm may be able to take advantage of access to information that they otherwise would not have had. O This employment offer represents a threat to the audit in the sense that the audit associate may now be more lenient to the client and overlook areas of audit concern.
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Related Book For
Auditing a risk based approach to conducting a quality audit
ISBN: 978-1133939153
9th edition
Authors: Karla Johnstone, Audrey Gramling, Larry Rittenberg
Posted Date:
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