Assignment 2-4 Auditing Ethical Dilemmas

Assignment 2-4 Auditing Ethical Dilemmas - ACCT470-V2WW...

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ACCT470-V2WW January 22, 2012 Auditing Ethical Dilemmas Assignment 2-4 Chapter 20 19-28: a.) The PEEC ruled that an auditor may provide such advisory services to an audit client and not violate Rule 101. Independence would be not considered impaired because the member's role is advisory in nature and because the client is a privately held entity. b.) The PEEC ruled that the auditor's independence under Rule 101 is not impaired as long as the client makes all significant management decisions related to the hiring of new personnel and the implementation of the system. The auditor would have to limit his supervisory activities to initial instruction and training of personnel and should avoid direct supervision of the actual operation of the system or related activities that would constitute undue involvement in or identification with management functions. If this was a publicly held company, independence would defiantly be impaired! c.)
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This note was uploaded on 02/29/2012 for the course ACCOUNTING 470 taught by Professor Kwong during the Spring '11 term at Franklin.

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