Question
Dona was an audit partner at GMPK. She also worked part-time for Magno Corporation. Magno was audited by Ballet-Dimzer. Due to a consolidation wave in
Dona was an audit partner at GMPK. She also worked part-time for Magno Corporation. Magno was audited by Ballet-Dimzer. Due to a consolidation wave in the profession, Ballet-Dimzer acquired GMPK. All parties are now concerned with independence, given that Dona works for a company that is audited by her new consolidated firm. Several steps are necessary to avoid impairing independence. Which of the following is not one of them?
Dona must quit her job at Magno before the merger is completed. | |
Dona cannot be a team member on the Magno audit if the engagement covers any period of time in which she worked for Magno. | |
Dona must quit her audit job and go to work for an entirely different accounting firm. | |
A responsible person in the new firm should assess Dona's prior relationship with Magno to assess whether any unreasonable threats to independence remain. |
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