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Q 4

The document discusses various threats to independence and safeguards. It provides examples of intimidation threats that could occur from a close relationship with an assurance client. It also lists examples of safeguards created by the profession, legislation or regulation with the exception of policies emphasizing a client's commitment to fair financial reporting. Examples of engagement-specific and firm-wide safeguards are also provided.

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52 views

Q 4

The document discusses various threats to independence and safeguards. It provides examples of intimidation threats that could occur from a close relationship with an assurance client. It also lists examples of safeguards created by the profession, legislation or regulation with the exception of policies emphasizing a client's commitment to fair financial reporting. Examples of engagement-specific and firm-wide safeguards are also provided.

Uploaded by

kate bautista
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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45.

Intimidation threat
A. is not a threat to independence.
B. occurs when a member of the assurance team may be deterred from acting objectively and
exercising professional skepticism by threat, actual or perceived, from the directors, officers or
employees of an assurance client.
C. occurs when, by virtue of a close relationship with an assurance client, its directors, officers or
employees, a firm or a member of the assurance team becomes too sympathetic to the client‘s
interests.
D. occurs when a firm, or a member of the assurance team, promotes, or may be perceived to promote,
an assurance client‘s position or opinion to the point that objectivity may, or may be perceived to be,
compromised.

46. Safeguards created by the profession, legislation or regulation, include the following, except:
A. Educational, training and experience requirements for entry into the profession.
B. Continuing education requirements.
C. Legislation governing the independence requirements of the firm.
D. Policies and procedures that emphasize the assurance client‘s commitment to fair financial reporting.

47. Which of the following is an example of engagement-specific safeguards?


A. Advising partners and professional staff of those assurance clients and related entities from which
the must be independent.
B. Consulting an independent third party, such as committee of independent directors, a professional
regulatory body or another professional accountant.
C. Policies and procedures that will enable the identification of interests or relationships between the
firm or members of engagement teams and clients.
D. External review by a legally empowered third party of the reports, returns, communications or
information produced by a professional accountant.

48. Which of the following is not a safeguard created by the profession, legislation or regulation?
A. Professional standards
B. Professional and procedures to implement and monitor quality control of engagements.
C. Continuing professional development requirements
D. Educational, training and experience requirements for entry into the profession.

49. Safeguards may eliminate or reduce threats to an acceptable level. The following are examples of
these safeguards:
I. Professional or regulatory monitoring and discipline procedures.
II. Documented internal policies and procedures requiring compliance with the fundamental principles.
III. Policies and procedures to monitor and, if necessary, manage the reliance on revenue received from
a single client.

Which of the foregoing examples of safeguards is/ are classified firm-wide safeguards in the work
environment?
A. All of these
B. I and II
C. II and III
D. I and III

50. Which of the following fundamental principles is compromised when a professional accountant is
associated with reports or returns that are significantly misleading?
A. Integrity
B. Competence and due professional care
C. Objectivity
D. Professional behavior

51. Safeguards may eliminate or reduce threats to an acceptable level. The following are examples of
these safeguards:
I. Professional or regulatory monitoring and disciplinary procedures.
II. Documented internal policies and procedures requiring compliance with the fundamental principles.
III. Policies and procedures to monitor and, if necessary, manage the reliance on revenue received from
a single client.
IV. Corporate governance regulations

Which of the foregoing examples of safeguards that can be applied is(are) created by the profession,
legislation or regulation?
A. I and III
B. II and Iv
C. I and IV
D. II and III

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