Question 3: (C1&C2&C3) (10 Points) Following its establishment five years ago by two plumbers using their redundancy pay, Jimmity Jammity Co has undergone a period of substantial growth. Due to a lack of accounting expertise within the company it has traditionally looked to its auditors, Au Ditore Co, for accounting services in the preparation of annual financial statements as well as for the statutory audit function. Au Ditore Co is a small firm of certified accountants and registered auditors whose clients are mainly small businesses. Although Jimmity Jammity Co was originally a typical small company client, its growth over the last five years has meant that it now accounts for approximately 20% of Au Ditore Co's gross fee income. The company has indicated that it may wish to issue shares on the stock market in the near future. With growing fees over the last five years, the company has recently asked the audit firm whether, going forward, it would be possible to calculate the audit fee as a percentage of profit. Au Ditore Co have been keen to expand their client base and have recently launched an advertising campaign in which they guarantee that to maximise the efficiency of the audit they will only allocate staff to the audit who have experience in the relevant business sector. As a result Plugberry Co, a major competitor of Jimmity Jammity Co have asked Au Ditore Co to replace their existing auditors immediately. Instructions: From the information above identify and explain FOUR ethical threats and for each threat explain the steps which Au Ditore Co should take to reduce the threat