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Why does a politically exposed person (PEP) will have higher risk for an engagement?
How does the reputation risk come from?
Thank you sir.
People in the public eye – whether they be politicians or anyone else – carry with them paparazzi and investigators looking into their every move and recording their every word – you don’t have to think beyond Donald T to appreciate what I’m saying
And with that public exposure there is attached risk
For an audit firm to be seen to be associated with that risk takes a major partner-level decision because the reputations of the firm and the client may become (to quote an ACCA expression from an article 6 years ago) inextricably intertwined
It happens with the auditors of H U G E clients too – KPMG in Birmingham are being closely looked at as a result of them being the auditors of the recently deceased Carillion (amongst others)
Generally, the greater the public interest, the greater the associated risk of spin-off reputation damage
OK?
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