C determining which recommendations of the firm

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C. Determining which recommendations of the firm should be implemented. D. Reporting, in a management role, to those charged with governance. 41. The following statements relate to the provision of taxation, internal audit or IT Systems services to audit clients. Which is false? A. Preparing calculations of current and deferred tax liabilities (or assets) for an audit client for the purpose of preparing accounting entries that will be subsequently audited by the firm creates a self- interest threat. B. A self-review threat may be created when a firm, or network firm, provides internal audit services to an audit client. C. The provision of services by a firm or network firm to an audit client that involve the design and implementation of financial information technology systems that are used to generate information forming part of a client’s financial statements may create a self-review threat. D. The provision of services in connection with the assessment, design, and implementation of internal accounting controls and risk management controls does not create a threat to independence provided that firm or network firm personnel do not perform management functions.
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42. When the total fees generated by an assurance client represent a large proportion of a firm’s total fees, the dependence on that client or client group and concern about the possibility of losing the client may create a/an A. Self-interest threat B. Self-review threat. C. Intimidation threat D. Advocacy threat 43. These are fees calculated on a predetermined basis relating to the outcome or result of a transaction or the result of the work performed. A. Contingent fees B. Fixed fees C. Predetermined fees D. Commissions. Page 8 44. Which of the following threats to independence may be created when litigation takes place, or appears likely, between the firm or a member of the assurance team the assurance client? A. Self-interest or advocacy threat B. Advocacy or intimidation threat C. Self-interest or intimidation threat D. Familiarity or self-review threat 45. As defined in the Code of Ethics, what is the communication to the public of information as to the services or skills provided by professional accountants in public practice with a view to procuring professional business? A. Advertising B. Publicity C. Solicitation D. Marketing professional services 46. After evaluating the significance of the threat created by an actual or threatened litigation, the following safeguards should be applied to reduce the threat to an acceptable level, except A. Disclosing to the audit committee, or others charged with governance, the extent and nature of the litigation. B. If the litigation involves a member of the assurance team, removing that individual from the assurance team.
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