When the safeguards available are insufficient to

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66. When the safeguards available are insufficient to eliminate the threats to independence or to reduce them to an acceptable level, or when a firm chooses not to eliminate the activities or interest creating the threat, the only course of action available will be the a. Issuance of an adverse opinion. b. Issuance of qualified opinion or disclaimer of opinion. c. Issuance of unqualified opinion with explanatory paragraph. d. Refusal to perform, or withdrawal from, the assurance engagement. 67. Which of the following is incorrect regarding engagement period?
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Page 11 of 21 Application of Principles to Specific Situations Financial Interests – Provisions applicable to all assurance clients 68. If a member of the assurance team, or their immediate family member, has a direct financial interest, or a material indirect financial interest, in the assurance client, the self-interest threat created would be so significant the only safeguards available to eliminate the threat or reduce it to an acceptable level would be to (choose the incorrect one) 69. If a member of the assurance team, or their immediate family member receives, by way of, for example, an inheritance, gift or, as a result of a merger, a direct financial interest or a material indirect financial interest in the assurance client, a self-interest threat would be created. The following safeguards should be applied to eliminate the threat or reduce it to an acceptable level: a. Disposing of the financial interest at the earliest practical date.
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  • Spring '10
  • Mr.Cula
  • Accounting, Accountant, Certified Public Accountant

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