You may use a tabulated format if helpful having Threats, Safeguards and Objective Assessment as column headings.

Stephen Tiler CPA has been appointed as a junior auditor of Best Solutions Limited (BSL). One of his first tasks is to review the firms audit clients to ensure that independence requirements of APES 110 (Code of Ethics for Professional Accountants) are being met. His review has revealed the following:

(a) BSL has recently been approached by Western Yachts Limited (WYL) to conduct its audit to which BSL has agreed. Paul Levesque is one of the audit partners at BSL who is being considered to lead the WYL audit. Pauls sister, Lynn Levesque is a cosmetic surgeon in Perth who is widely regarded for excellence in plastic surgery. Paul is aware that Lynn holds significant shares in WYL.

(b) BSL has recently been approached by Western Tech Limited (WTL) to conduct its audit to which BSL has agreed. The accountant and financial advisor at WTL, Tom Hardy is the brother of James Hardy CA, who is the audit partner at BSL. James has put in a request to lead the WTL audit. James believes that he can get the WTL audit completed efficiently and effectively since he shares a very good relationship with Tom and can get all the necessary information from him.

(c) Superior Chrome Limited (SCL) has been a long standing client of BSL. Since the past few months SCL has been having issues with its existing information technology (IT) system which appears to be dated. SCL has approached BSL to design and implement its IT system. SCL feels that BSL can do the best job in this regard given BSLs familiarity with SCLs operations. SCL has also requested BSL to recruit staff to work its newly implemented IT system. (

d) Steven Rowley, the current senior manager on the audit of Western Minerals Limited (WML) which specialises in the production of mining equipment, is planning on entering into a business partnership (Luxury Caravans Limited) with the CFO of WML, whereby they will both be equal partners in a business retailing caravans. Steven informs Stephen Tiler that this is not a problem since the two entities (WML and Luxury Caravans Limited) are in different non-competing industries.

(e) Bradley Cooper CPA is a partner in BSL and the engagement partner on the audit of Western Chemicals Limited (WCL). Jennifer Lawrence CA is another partner in BSL who provides non-audit services to WCL. Jennifers husband Cooke Maroney is planning on purchasing significant shares in WCL.

Required: For each of the independent situations above, and using the conceptual framework in APES 110 (Code of Ethics for Professional Accountants), answer the following questions:

1. Identify potential threat(s) to independence & recommend safeguards (if any) to reduce the independence threat(s) identified.

2. Provide an objective assessment of whether audit independence can be achieved