ABC Ltd is a furniture manufacturing company. John and his wife Lisa own the majority of shares in the AAA Group which controls ABC Ltd. John is the chairman and the board of directors of both AAA Group and ABC Ltd, and Lisa is a director of both companies as well as the CEO of the ABC Ltd. In January 20X0, John approached your audit firm, CCC &Co, to carry out the ABC audit for the year ended 30 June 20XO. ABC Ltd has not been audited before but this year the audit has been requested by the company's bank and a new private equity investor group which has just acquired a 25 per cent share of ABC Ltd. You know that one of the partners at CCC&Co went to school with John and has been friends with both John and Lisa for many years. Required: 1. Identify and explain the significant threats to independence for CCC&Co in accepting the audit of ABC Ltd. (3 marks) 2. Explain any safeguards that CCC & Co could implement to reduce the threat to an acceptable level. (2 marks) 3. Describe what is meant by independence in mind and independence in appearance. (2 marks)