Financial statements 290176 if the valuation service

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Unformatted text preview: delines are applied when performing a particular valuation service. (c) For valuations involving standard or established methodologies, the degree of subjectivity inherent in the item concerned. (d) The reliability and extent of the underlying data. (e) The degree of dependence on future events of a nature which could create significant volatility inherent in the amounts involved. (f) The extent and clarity of the disclosures in the financial statements. 290.178 When a firm, or a network firm, performs a valuation service for a financial statement audit client for the purposes of making a filing or return to a tax authority, computing an amount of tax due by the client, or for the purpose of tax planning, this would not create a significant threat to independence because such valuations are generally subject to external review, for example by a tax authority. 290.179 When the firm performs a valuation that forms part of the subject matter information of an assurance engagement that is not a financial statement audit engagement, the firm should consider any self-review threats. If the threat is other than clearly insignificant, safeguards should be considered and applied as necessary to eliminate the threat or reduce it to an acceptable level. Provision of Taxation Services to Financial Statement Audit Clients 290.180 Taxation services comprise a broad range of services, including compliance, planning, provision of formal taxation opinions and assistance in the resolution of tax disputes. Such assignments are generally not seen to create threats to independence. Provision of Internal Audit Services to Financial Statement Audit Clients 290.181 A self-review threat may be created when a firm, or network firm, provides internal audit services to a financial statement audit client. The range of activities encompassed by the term ‘internal audit services’ is wide. Internal audit services may comprise an extension of the firm’s audit service beyond 82 By-Laws (On Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants [Issued January 2007] PART I: BY-LAWS ON PROFESSIONAL ETHICS requirements of generally accepted auditing standards, assistance in the performance of a client’s internal audit activities in specific areas (for example, by providing specialized technical services or resources in particular locations), or outsourcing of the activities, or providing occasional internal audit services on an ad hoc basis. In evaluating any threats to independence, the nature of the service will need to be considered. For this purpose, internal audit services do not include operational internal audit services unrelated to the internal accounting controls, financial systems or financial statements. 290.182 Services involving an extension of the procedures required to conduct a financial statement audit in accordance with Malaysian Approved Standards on Auditing would not be considered to impair independence with respect to the aud...
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This document was uploaded on 09/23/2013.

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