The value of audit is therefore noted to be derived wholly from its independence. Without the concept of independence, the auditors are noted to lack both credibility and opinion. The nature of relationship that exists between a client and an auditor is by itself a threat to the concept of independence. Incidents of influencing the auditor reports on the financial position of clients have been noted to result due to conflict of interest. The possibilities of a conflict of interest existing between clients and firms are noted to exist. Various connections such as audit firms being associated with other firms, personal as well as family relationships, client's financial interests, employment with the audit firms as well as the provision of various non-audit services to the audit clients are noted to affect the independence...
Strength in character is therefore necessary in order to enable the auditors to have independence in their opinions.
Any threats to independence of the client can be determined on whether threats are created by past services from the client or business relationships before the audit engagement. Importance of Independence of Auditor and Client: During financial statement engagements, the independence of auditors and clients is important because of the following reasons & #8230; Lesser Inappropriateness: The closer the relationship between an auditor and his/her client is the higher the probability and perception
Independence of Auditors The objective of this study is to consider the statement as follows: "Unquestionably, the HIH story is also one of auditor failure" and to research into the background of the HIH collapse in Australia insofar as it relates to the role of auditors and their liability. A report will be prepared with summaries of the most important documents concerning this issue of auditor independence after the HIH collapse,
auditing comes with immense responsibility as it plays a vital role in maintaining a check and balance and establishes an organization's credibility and repute among its stakeholder. An auditor's report is a key document that most stakeholders use when taking decisions pertaining to an organization. For this it is important for auditors to show highest levels of compliance with ethics. Auditors and Ethics Audit and Ethics have a very deep relationship
How Nigerians Can Influence the Change We Desire Introduction There is a general belief that poor corporate governance has been the vulnerable point of numerous companies in both developing and developed countries. This is especially the case with Nigeria, where in spite of being vastly blessed with resources such as oil and a huge labor force, continued to be adversely impacted by corruption. Good governance is a significant step in facilitating market
During a routine investigation, one the actuaries discovers that there are some possible red flags for illegal activity. When they report these issues to their supervisors, they are told to not worry about that. What make this so troubling is auditors have an ethical duty, to protect the interests of their clients and the public. The problem is that they want to remain a part of the team. Yet,
Ethics and Independence in the Accounting Profession There are according to the text, two primary reasons that people act unethically. A person will act unethically if there standards differ substantially from those of society "as a whole" or if the person chooses consciously to act in a selfish manner. There is no profession more profoundly impacted by the effects of ethical standards that the accounting profession. The effects of ethical and unethical
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