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

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.

(B) BBAS has recently been approached by South Mining Limited (SML) to conduct its audit to which BBAS has agreed. Randy Orton is one of the audit partners at BBAS. Randys daughter Sarah has recently received shares in SML as a gift. Sarah is a final year law student at a reputed university and is financially dependent on her parents. Being aware of the situation, BBAS will not be assigning Randy to the audit team of SML.