Revised Code of Ethics in the Phils - 2010

The firm and b the individual does not continue to

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Unformatted text preview: arged with governance. Employment with an Audit Client 290.134 Familiarity or intimidation threats may be created if a director or officer of the audit client, or an employee in a position to exert significant influence over the preparation of the client’s accounting records or the financial statements on which the firm will express an opinion, has been a member of the audit team or partner of the firm. 290.135 If a former member of the audit team or partner of the firm has joined the audit client in such a position and a significant connection remains between the firm and the individual, the threat would be so significant that no safeguards could reduce the threat to an acceptable level. Therefore, independence would be deemed to be compromised if a former member of the audit team or partner joins the audit client as a director or officer, or as an employee in a position to exert significant influence over the preparation of the client’s accounting records or the financial statements on which the firm will express an opinion, unless: (a) The individual is not entitled to any benefits or payments from the firm, unless made in accordance with fixed pre-determined arrangements, and any amount owed to the individual is not material to the firm; and (b) The individual does not continue to participate or appear to participate in the firm’s business or professional activities. 290.136 If a former member of the audit team or partner of the firm has joined the audit client in such a position, and no significant connection remains between the firm and the individual, the existence and significance of any familiarity or intimidation threats will depend on factors such as: • The position the individual has taken at the client; • Any involvement the individual will have with the audit team; • The length of time since the individual was a member of the audit team or partner of the firm; and • The former position of the individual within the audit team or firm, for example, wh...
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