Question Two The following situations are related to auditor independence. I. Wollongong Inc. has struggled financially...

 

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Question Two The following situations are related to auditor independence. I. Wollongong Inc. has struggled financially and has been unable to pay the audit fee to its auditor, Seale and Seale, ACA, for the 2019 and 2020 audits. Seale and Seale is currently planning the 2021 audit. II. Required: a) b) Total: 20 marks As the auditor, you are invited to attend your client's annual holiday party. When presents are handed out, you are surprised to find your name included. The present has a value of approximately £300. Identify whether independence could have been violated in the two above cases. (10 marks) Indicate the type of threat to independence if your answer to a) is a Yes. (10 marks) Question Two The following situations are related to auditor independence. I. Wollongong Inc. has struggled financially and has been unable to pay the audit fee to its auditor, Seale and Seale, ACA, for the 2019 and 2020 audits. Seale and Seale is currently planning the 2021 audit. II. Required: a) b) Total: 20 marks As the auditor, you are invited to attend your client's annual holiday party. When presents are handed out, you are surprised to find your name included. The present has a value of approximately £300. Identify whether independence could have been violated in the two above cases. (10 marks) Indicate the type of threat to independence if your answer to a) is a Yes. (10 marks)

Answer rating: 100% (QA)

Required I i Yes Auditors independence could be at a stake here When a significant amount of fees of ... View the full answer