41)The purpose of ____________ is to help manage and control risk appropriately rather than to eliminate it.

Risk management

Internal control system

Internal audit

External audit

42)Which of the following circumstances may create self-interest threats for members:

a) holding a financial interest in, or receiving a loan or guarantee from, the employing organisation

b) participating in incentive compensation arrangements offered by the employing organisation

c) inappropriate personal use of corporate assets

d) concern over employment security

e) commenting publicly on future events in particular circumstances, having made assertions without sufficient support

Only a) , b), c) and d)

Only b) and d)

Only a) , b) , c) and e)

All a) , b) , c) , d) and e)

43)Independence is compromised in which of the following situations?

The auditor received payment for past due billings from the company who is no longer his client.

The auditor withdraws himself from the engagement team who will audit the business of his brother.

The auditor obtained a loan from his friends bank. The bank is not a client of the auditors firm

The auditor is currently auditing a company where his brother is the Managing Director.