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5. Would the following individuals or groups be classified as external, internal or connected stakeholders?
External or Internal or Connected Supplier of finance
External or Internal or Connected Lobbyist
External or Internal or Connected or External auditor
External or Internal or Connected DirectorAnswer. External Auditor
I would place an external auditor as connected. They have to be independent and are appointed by the members, but they have a contractual relationship with the company and will advise on internal control and the presentation of the financial statements.
Sorry, I forgot to mention my doubt regarding this question. I choose connected stakeholder for external auditor as well but there it is mentioned that an external auditor is external stakeholder. That’s what I don’t understand as they do have a contractual relationship with business.
The same point about being External Auditor an external stakeholder was mentioned in the explanations of the answers for other mcqs of this chapter on StudyHUb.
I think the StudyHub answer reflects what ACCA would like to think the relationship is, ie fully independent, rather than what it actually is.
If this question comes up in the exam go for ‘External’!
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