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Unformatted text preview: r the firm has provided the advice which is the subject of thetax dispute; • The extent to which the outcome of the dispute will have a materialeffect on the financial
statements on which the firm will express anopinion; • The extent to which the matter is supported by tax law or regulation,other precedent, or
established practice; • Whether the proceedings are conducted in public; and 72 • The role management plays in the resolution of the dispute. The significance of any threat created shall be evaluated and safeguardsapplied when necessary
to eliminate the threat or reduce it to an acceptablelevel. Examples of such safeguards include:
• Using professionals who are not members of the audit team toperform the service; • Having a tax professional, who was not involved in providing the taxservice, advise the
audit team on the services and review thefinancial statement treatment; or • Obtaining advice on the service from an external tax professional. 290.193 Where the taxation services involve acting as an advocate for an audit clientbefore a public
tribunal or court in the resolution of a tax matter and theamounts involved are material to the
financial statements on which the firmwill express an opinion, the advocacy threat created
would be so significantthat no safeguards could eliminate or reduce the threat to an
acceptablelevel. Therefore, the firm shall not perform this type of service for an auditclient.
What constitutes a “public tribunal or court” shall be determinedaccording to how tax
proceedings are heard in the particular jurisdiction.
290.194 The firm is not, however, precluded from having a continuing advisory role(for example,
responding to specific requests for information, providingfactual accounts or testimony about
the work performed or assisting theclient in analyzing the tax issues) for the audit client in
relation to the matterthat is being heard before a public tribunal or court.
Internal Audit Services
290.195 The scope and objectives o...
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This document was uploaded on 04/03/2014.
- Spring '14