Question
(a) Identify the five (5) ethical threats to independence.(5 marks) (b) For each of the following situations (threats), identify the type of ethical threat it
(a) Identify the five (5) ethical threats to independence.(5 marks)
(b) For each of the following situations (threats), identify the type of ethical threat it is and explain what safeguards you would put in place to addressthe threat:-
(i)Your husband is a director in the company for which you are assigned as one of the auditors;
(ii)You prepared the accounting information for ABC Limited and you are also a part of the audit team to complete their audit for the yearended December 31, 2019;
(iii)You have been invited to the audit client's banquet where they want you to make a presentation to the persons present concerning sharesthat they would like to issue.
(iv)You are about to start the audit for the year 2019 but the client still owes fees for the year 2018.They want you to start working on thenew audit (for 2019) and promises to pay as long as a favourable report is produced.
(v)You have been the audit manager on the audit of ZYX Limited for the past 6 years.You and the company's CEO and his family go onvacations together every year.
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