“Accepting the assignment may also create a self-interest threat as a result of the auditor being perceived to have an interest in the outcome of negotiation with a third party and which may motivate the auditor to behave in order to protect that interest."
The auditor's interest, in this case, is able to obtain higher audit fees when the client able to successfully expand through obtain the loan?
Ask the Tutor ACCA AAA
Sept 2018 Q3(a)(i)
5y ago#1It's just discussing in general terms that if the auditor promotes an audit client's interest there will be a perception that there is "something in it" for the auditor (i.e. self-interest). Whether there is, in fact, or not is not the issue - it's the perception of independence.
Sign in to reply to this topic.