Compliance with these fundamental principles may
potentially be threatened by a broad range of circumstances. Many threats fall
into the following categories:
potentially be threatened by a broad range of circumstances. Many threats fall
into the following categories:
·
Self-interest
threats, which may occur as a result of the financial or other interests of a
professional accountant or an immediate or close family member.
Self-interest
threats, which may occur as a result of the financial or other interests of a
professional accountant or an immediate or close family member.
·
Self-review
threats, which may occur when a previous judgments needs to be re-evaluated by
the accountant originally responsible for that judgment.
Self-review
threats, which may occur when a previous judgments needs to be re-evaluated by
the accountant originally responsible for that judgment.
·
Advocacy
threats, which may occur when an accountant promotes a position or opinion to
the point that subsequent objectivity, may be compromised.
Advocacy
threats, which may occur when an accountant promotes a position or opinion to
the point that subsequent objectivity, may be compromised.
·
Familiarity
threats, which may occur when, because of a close relationship, a professional
accountant becomes too sympathetic to the interests of others.
Familiarity
threats, which may occur when, because of a close relationship, a professional
accountant becomes too sympathetic to the interests of others.
·
Intimidation
threats, which may occur when a professional accountants may be deterred from
acting objectively by threats, actual or perceived.
Intimidation
threats, which may occur when a professional accountants may be deterred from
acting objectively by threats, actual or perceived.
Safeguards that may eliminate or reduce these sorts
of threats to an acceptable level fall into two broad categories:
of threats to an acceptable level fall into two broad categories:
a)
Safeguards
created by the profession, legislation or regulation; and
Safeguards
created by the profession, legislation or regulation; and
b)
Safeguards
in the work environment.
Safeguards
in the work environment.
Safeguards created by the profession, legislation
include, but are not restricted to:
include, but are not restricted to:
·
Educational,
training and experience requirements for entry into the profession.
Educational,
training and experience requirements for entry into the profession.
·
Continuing
professional development
Continuing
professional development
·
Corporate
governance regulations.
Corporate
governance regulations.
·
Professional
standards
Professional
standards
·
professional
or regulatory monitoring and disciplinary procedures.
professional
or regulatory monitoring and disciplinary procedures.
Safeguards in the work environment include
generally avoiding or minimizing threats to auditor objectivity and
independence.
generally avoiding or minimizing threats to auditor objectivity and
independence.
