Employment with assurance client 6. Recent services with assurance clients 7. Long association of senior personnel with assurance clients 8. Provision of non assurance services to assurance clients: When control exists, the financial interest is considered direct.
Such safeguards might include: The effect is on disclosures reflected in fmancial statements. Other corporate finance services may create advocacy or selfreview threats. Accordingly the audit firm should not enter into such fee arrangement.
Safeguards fall into two categories: Why independence is necessary for assurance clients? Explain your understanding of subject matter information. Arguments against providing other services 1. Continuity of staff may be a problem. Arguments for providing other services to an audit client. The audit firms will get additional busines. Compilation services include assisting the client in: Total assets of the firm including stocks were Rs.
The firm owes Rs. The auditor has completed the audit fieldwork of the company by April. The auditor has a duty of confidentiality and therefore he should not disclose the weak financial position of the firm to the limited company. What do you understand by the concept of self-regulation? Self-regulation implies rrummum interference by Government in regulating the accounting profession. Certain measures that the auditor should adopt to minimize litigation claims include: Obtain sufficient appropriate audit evidences 2.
Carry out risk assessment procedures 3. Discuss with the staff the major risk areas 4. Study and evaluate internal controls 5. Consider compliance with laws and regulations 6. Carry out audit with an attitude to professional skepticism 7. Consider unusual relationship among data 8. Review the,work of assistants 9. Complete disclosure checklist Carry out tests for subsequent events Modify and extend audit procedures where suspicion arises Verify compliance of accounting standards What is professional clearance letter?
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