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Hi,
I have some confused about …………(self-interest review)
1. for a client is a listing company – the total service fee cannot more than 15% for the two consecutive years of the total income fee of the audit firm.
2. for a client is a limited company – cannot more than 10% every year
Are these correct ?
Thank you
Gloria
The rules now do not specify a % for non-public interest companies. The rules now are:
Where an audit client is a public interest entity and, for two consecutive years,
the total fees from the client and its related entities represent more than 15% of the total fees received by thefirm expressing the opinion on the financial statements of the client, the firm shalldisclose to those charged with governance of the audit client the fact that the
total of such fees represents more than 15% of the total fees received by the firm,
and discuss which of the safeguards below it will apply to reduce the threat to an
acceptable level, and apply the selected safeguard.Although no % is mentioned for non public interest audits, auditors should stil be minfful of the potential self-interest threat from large proportions of fees from one client.
A practice question in F8 :
To avoid a self-interest threat arising, auditors of a listed company should normally not received more than a certain percentage of their total fees from that client :What is the recommended maximum percentage :
My answer is 15% (wrong)
should be 10%, why, could you please explain to me ?
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