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Good morning sir… i have got question to ask you please help me..
june 2015 q.1 regarding ethics.. in one of the threat is mangment asking auditor tohelp them recruit new NED.. i did get it is self interst threat if auditor help them but in explanation of examiner answer state it is self intrrst threat because NED appoint audit firm… i dont understand that simce shareholder appoint audit firm.. does this meant i am wrong ..can you please explain to me .. thank you in advance..
The examiner explains that NED has key responsibilty appointing audit firm.. but how ..is it not share holder who appoint auditors in AGM… thank you
When audit firm receives 15 %of total fees from single client. This represent self interest threat
but for explaination can i say …. there is potential self interst threat as auditors may ignore errors in FS in fear of loosing client.
for mitigation can i say that they should review and assess fees if it represent more than 15% they should consider refuse taking non audit work such as taxation .. thank you sir..
once i get this answer my ethical threat questions well prepared…. thank you for your time..
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