- This topic has 3 replies, 2 voices, and was last updated 3 months ago by Kim Smith.
- April 18, 2020 at 1:29 pm #568668toushiga
I. Why providing recruitment service will give rise to intimidation threats? for not appointing/recommend the external auditor next year?
ii. Can I have an example for the professional benefits of accepting the assignment? increase the non-engagement related fees for the audit firm?
iii. How the reduction in sales and the expense relating to the repair of $46m being calculated? no mention in the question?
Thank you.April 20, 2020 at 8:46 am #568813Kim SmithKeymaster
Please remember to give FULL Q reference (year missing).
(i) Say the auditor were to recruit/select a candidate for the position of finance director to a client company. And the auditor tells the CEO of the client that this person really knows their stuff and is the best person for the job. Imagine then that on a matter of judgment the FD proposes something and the auditor disagrees – the CEO then pressures the auditor to agree with the FD’s judgment – “after all – you said he was the expert”.
(ii) I guess the examiner is saying that credit would be given for saying that the fee would be a matter to consider.
(iii) There aren’t many options – if given numbers in a Q you should try to make use of them – otherwise you could be missing something. $46m is $111m – $65.August 13, 2020 at 12:40 pm #580381toushiga
for part (i),how to write the explaination or justification related to the initimidation threat in short in the exam question?something like the FD may disagree with auditor and being pressured by management as the person is being recommended by the auditor?
Thank you.August 13, 2020 at 2:33 pm #580392Kim SmithKeymaster
I cannot advise on a one-to-one basis how to write answer points – I suggest you read the marking guidance article sticky posted to this forum and look out for the marking video to be released at the end of next week (also flagged with a sticky post on this forum).
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