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Self-interest (Stark BPP)

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AA Exams › Self-interest (Stark BPP)

  • This topic has 1 reply, 2 voices, and was last updated 3 months ago by Kim Smith.
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  • April 12, 2022 at 7:45 am #653125
    Sourav9271
    • Topics: 158
    • Replies: 104
    • ☆☆☆

    Hello sir,
    Why will the following situation create a Self-interest threat

    In an initial meeting with the finance director of Stark, you learn that the audit team will not be
    entertained on Stark’s yacht this year; instead, he has arranged a balloon flight costing less than
    one-tenth of the expense of using the yacht and hopes this will be acceptable.

    April 12, 2022 at 8:23 am #653133
    Kim Smith
    Keymaster
    • Topics: 91
    • Replies: 6208
    • ☆☆☆☆☆

    Ooooo! Well I would want to be on the audit team that got free trips on yachts and balloons – I couldn’t possibly afford that myself! I would very much like such a client! I wouldn’t want to upset them in anyway – e.g. argue about an accounting treatment – in case they didn’t include me in the invitation!

    That the balloon trip costs the client only 10% of the use of the yacht doesn’t necessarily make it acceptable – this would have to be assessed – and addressed if not acceptable. This may mean declining the the invitation.

    Does that help? What do you think it is if not (personal) self-interest?

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