Revised Code of Ethics in the Phils - 2010

Post issuance review when the total fees

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: 2 Where an audit client is a public interest entity and, for two consecutiveyears, the total fees from the client and its related entities (subject to theconsiderations in paragraph 290.27) represent more than 15% of the totalfees received by the firm expressing the opinion on the financial statementsof the client, the firm shall disclose to those charged with governance of theaudit client the fact that the total of such fees represents more than 15% ofthe total fees received by the firm, and discuss which of the safeguardsbelow it will apply to reduce the threat to an acceptable level, and apply theselected safeguard: • Prior to the issuance of the audit opinion on the second year’sfinancial statements, a professional accountant, who is not a memberof the firm expressing the opinion on the financial statements,performs an engagement quality control review of that engagementor a professional regulatory body performs a review of thatengagement that is equivalent to an engagement quality controlreview (“a pre-issuance review”); or • After the audit opinion on the second year’s financial statements hasbeen issued, and before the issuance of the audit opinion on the thirdyear’s financial statements, a professional accountant, who is not amember of the firm expressing the opinion on the financialstatements, or a professional regulatory body performs a review ofthe second year’s audit that is equivalent to an engagement qualitycontrol review (“a post-issuance review”). When the total fees significantly exceed 15%, the firm shall determinewhether the significance of the threat is such that a post-issuance reviewwould not reduce the threat to an acceptable level and, therefore, a pre-IESBAissuance review is required. In such circumstances a preissuance reviewshall be performed. Thereafter, when the fees continue to exceed 15% each year, the disclosureto and discussion with those charged with governance shall occur and oneof the above safeguards shall be applied. If the fees significantly exceed15%, the firm shall determine whether the significance...
View Full Document

This document was uploaded on 04/03/2014.

Ask a homework question - tutors are online