湖北省考生注意：2020年ACCA国际会计师考试准考证打印预计时间

正确答案：
5 FOX & STEEPLE – THREE AUDIT ASSIGNMENTS
(i) Threats to independence
Self-interest
Tutorial note: This threat arises when a firm or a member of the audit team could benefit from a financial interest in, or
other self-interest conflict with, an assurance client.
■ A self-interest threat could potentially arise in respect of any (or all) of these assignments as, regardless of any fee
restrictions (e.g. per IFAC’s ‘Code of Ethics for Professional Accountants’), the auditor is remunerated by clients for
services provided.
■ This threat is likely to be greater for Huggins Co (larger/listed) and Gray Co (requires other services) than for Blythe Co
(audit a statutory necessity).
■ The self-interest threat may be greatest for Huggins Co. As a company listed on a recognised stock exchange it may
give prestige and credibility to Fox & Steeple (though this may be reciprocated). Fox & Steeple could be pressurised into
taking evasive action to avoid the loss of a listed client (e.g. concurring with an inappropriate accounting treatment).
Self-review
Tutorial note: This arises when, for example, any product or judgment of a previous engagement needs to be re-evaluated
in reaching conclusions on the audit engagement.
■ This threat is also likely to be greater for Huggins and Gray where Fox & Steeple is providing other (non-audit) services.
■ A self-review threat may be created by Fox & Steeple providing Huggins with a ‘thorough examination’ of its computerised
systems if it involves an extension of the procedures required to conduct an audit in accordance with International
Standards on Auditing (ISAs).
■ Appropriate safeguards must be put in place if Fox & Steeple assists Huggins in the performance of internal audit
activities. In particular, Fox & Steeple’s personnel must not act (or appear to act) in a capacity equivalent to a member
of Huggins’ management (e.g. reporting, in a management role, to those charged with governance).
■ Fox & Steeple may provide Gray with accounting and bookkeeping services, as Gray is not a listed entity, provided that
any self-review threat created is reduced to an acceptable level. In particular, in giving technical advice on financial
reporting, Fox & Steeple must take care not to make managerial decisions such as determining or changing journal
entries without obtaining Gray’s approval.
■ Taxation services comprise a broad range of services, including compliance, planning, provision of formal taxation
opinions and assistance in the resolution of tax disputes. Such assignments are generally not seen to create threats to
independence.
Tutorial note: It is assumed that the provision of tax services is permitted in the jurisdiction (i.e. that Fox and Steeple
are not providing such services if prohibited).
■ The due diligence reviews for Gray may create a self-review threat (e.g. on the fair valuation of net assets acquired).
However, safeguards may be available to reduce these threats to an acceptable level.
■ If staff involved in providing other services are also assigned to the audit, their work should be reviewed by more senior
staff not involved in the provision of the other services (to the extent that the other service is relevant to the audit).
■ The reporting lines of any staff involved in the audit of Huggins and the provision of other services for Huggins should
be different. (Similarly for Gray.)
Familiarity
Tutorial note: This arises when, by virtue of a close relationship with an audit client (or its management or employees) an
audit firm (or a member of the audit team) becomes too sympathetic to the client’s interests.
■ Long association of a senior member of an audit team with an audit client may create a familiarity threat. This threat
is likely to be greatest for Huggins, a long-standing client. It may also be significant for Gray as Fox & Steeple have had
dealings with this client for seven years now.
■ As Blythe is a new audit client this particular threat does not appear to be relevant.
■ Senior personnel should be rotated off the Huggins and Gray audit teams. If this is not possible (for either client), an
additional professional accountant who was not a member of the audit team should be required to independently review
the work done by the senior personnel.
■ The familiarity threat of using the same lead engagement partner on an audit over a prolonged period is particularly
relevant to Huggins, which is now a listed entity. IFAC’s ‘Code of Ethics for Professional Accountants’ requires that the
lead engagement partner should be rotated after a pre-defined period, normally no more than seven years. Although it
might be time for the lead engagement partner of Huggins to be changed, the current lead engagement partner may
continue to serve for the 2006 audit.
Tutorial note: Two additional years are permitted when an existing client becomes listed, since it may not be in the
client’s best interests to have an immediate rotation of engagement partner.
Intimidation
Tutorial note: This arises when a member of the audit team may be deterred from acting objectively and exercising
professional skepticism by threat (actual or perceived), from the audit client.
■ This threat is most likely to come from Blythe as auditors are threatened with a tendering process to keep fees down.
■ Peter may have already applied pressure to reduce inappropriately the extent of audit work performed in order to reduce
fees, by stipulating that there should not be an interim audit.
■ The audit senior allocated to Blythe will need to be experienced in standing up to client management personnel such as
Peter.
Tutorial note: ‘Correct’ classification under ‘ethical’, ‘other professional’, ‘practical’ or ‘staff implications’ is not as important
as identifying the matters.
(ii) Other professional and practical matters
Tutorial note: ‘Other professional’ includes quality control.
■ The experience of staff allocated to each assignment should be commensurate with the assessment of associated risk.
For example, there may be a risk that insufficient audit evidence is obtained within the budget for the audit of Blythe.
Huggins, as a listed client, carries a high reputational risk.
■ Sufficient appropriate staff should be allocated to each audit to ensure adequate quality control (in particular in the
direction, supervision, review of each assignment). It may be appropriate for a second partner to be assigned to carry
out a ‘hot review’ (before the auditor’s report is signed) of:
– Blythe, because it is the first audit of a new client; and
– Huggins, as it is listed.
■ Existing clients (Huggins and Gray) may already have some expectation regarding who should be assigned to their
audits. There is no reason why there should not be some continuity of staff providing appropriate safeguards are put in
place (e.g. to overcome any familiarity threat).
■ Senior staff assigned to Blythe should be alerted to the need to exercise a high degree of professional skepticism (in the
light of Peter’s attitude towards the audit).
■ New staff assigned to Huggins and Gray would perhaps be less likely to assume unquestioned honesty than staff
previously involved with these audits.
Logistics (practical)
■ All three assignments have the same financial year end, therefore there will be an element of ‘competition’ for the staff
to be assigned to the year-end visits and final audit assignments. As a listed company, Huggins is likely to have the
tightest reporting deadline and so have a ‘priority’ for staff.
■ Blythe is a local and private company. Staff involved in the year-end visit (e.g. to attend the physical inventory count)
should also be involved in the final audit. As this is a new client, staff assigned to this audit should get involved at every
stage to increase their knowledge and understanding of the business.
■ Huggins is a national operation and may require numerous staff to attend year-end procedures. It would not be expected
that all staff assigned to year-end visits should all be involved in the final audit.
Time/fee/staff budgets
■ Time budgets will need to be prepared for each assignment to determine manpower requirements (and to schedule audit
work).
(iii) Implications for allocating staff
■ Fox & Steeple should allocate staff so that those providing other services to Huggins and Gray (that may create a selfreview
threat) do not participate in the audit engagement.
Competence and due care (Qualifications/Specialisation)
■ All audit assignments will require competent staff.
■ Huggins will require staff with an in-depth knowledge of their computerised system.
■ Gray will require senior audit staff to be experienced in financial reporting matters specific to communications and
software solutions (e.g. in revenue recognition issues and accounting for internally-generated intangible assets).
■ Specialists providing tax services and undertaking the due diligence reviews for Gray may not be required to have any
involvement in the audit assignment.

正确答案：
3 MULLIGAN CO
(a) Matters to be discussed would include the following:
The exact content of the business plan which could include:
– Description of past business performance and key products
– Discussion of the new product
– Evidence of the marketability of the new product
– Cash flow projections
– Capital expenditure forecasts
– Key business assumptions.
The form. of the assurance report that is required – in an assurance engagement the nature and wording of the expected
opinion should be discussed. Webb & Co should clarify that an opinion of ‘negative assurance’ will be required, and whether
this will meet the bank’s lending criteria.
The intended recipient of the report – Webb & Co need to clarify the name and address of the recipient at LCT Bank. For the
limitation of professional liability, it should be clarified that LCT Bank will be the only recipient, and that the assurance opinion
is being used only as part of the bank’s overall lending decision.
Limiting liability – Webb & Co may want to receive in writing a statement that the report is for information purposes only, and
does not give rise to any responsibility, liability, duty or obligation from the firm to the lender.
Deadlines – it should be discussed when the bank need the report. This in turn will be influenced by when Mulligan Co needs
the requested $3 million finance. The bank may need a considerable period of time to assess the request, review the report,
and ensure that their lending criteria have been fully met prior to advancing the finance.
Availability of evidence – Mulligan Co should be made aware that in order to express an opinion on the finance request, they
must be prepared to provide all the necessary paperwork to assist the assurance provider. Evidence is likely to include
discussions with key management, and written representations of discussions may be required.
Professional regulation – Webb & Co should discuss the kind of procedures that will be undertaken, and confirm that they
will be complying with relevant professional guidance, for example:
– ISAE 3000 Assurance Engagements other than Audits or Reviews of Historical Financial Information
– ISAE 3400 The Examination of Prospective Financial Information
Engagement administration – any points not yet discussed in detail when deciding to take the assurance engagement should
be finalised at the meeting. These points could include the following:
– Fees – the total fee and billing arrangements must be agreed before any work is carried out
– Personnel – Webb & Co should identify the key personnel who will be involved in the assignment
– Complaints procedures – should be briefly outlined (the complaints procedures in an assurance engagement may differ
from an audit assignment)
– Engagement letter – if not already signed by both Webb & Co and Mulligan Co, the engagement letter should be
discussed and signed at the meeting before any assignment work is conducted.
Tutorial note: the scenario states that Webb & Co have already decided to take the assurance assignment for their existing
client, therefore the answer to this requirement should not focus on client or engagement acceptance procedures.

正确答案：B