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Hi tutor,
In a situation where an engagement partner leaves during the year to join the audit client as a finance director, what safeguards would you think are most appropriate?
I’m thinking to modify the audit firm’s systems and procedures so the engagement partner will not be overly familiar with them, but is this too extreme?
Hope to get your help on this, thank you 🙂
You couldn’t do that. Audit procedures are carefully designed and staff would have been trained.
Certainly the audit team should not be staffed with people who worked for the ex-audit partner previously on the audit.
So saying this would give rise to a familiarity threat (rather than a self interest threat) is more appropriate, is that correct?
For the current audit, familiarity is more of a threat. For last year’s audit, when the partner might have been lining up the job, self interest would br relevant.
I am sorry for bringing this up again, if an engagement partner leaves the audit firm last year to join the audit client, how will it give rise to a self interest threat? I’m confused as to how the ex-engagement partner could influence the current year audit team without linking to familiarity threat.
The exams just ended and it was quite okay, thank you for taking your time in clarifying my doubts for the past 6 months!
🙂 🙂
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