Question

explain 3 threats to q professional accountant and suggest two ways each of overcoming those threats.
KINDLY ANSWER ASAP
VERY URGENT
DIFFERENT OPINION NEEDED.
REFERNCING REQUIRED...

Answer 1

Self interest threat is the threat where a financial or other interest will inappropriately influence the professional accountant’s judgment or behaviour.

- to overcome this the related parties and their transactions should be specifically and significantly observed and necessary internal control should be designed.

Self Review threat is a professional accountant will not appropriately evaluate the results of a previous judgment made or service performed by the professional accountant, or by another individual within the professional accountant’s firm or employing organisation, on which the accountant will rely when forming a judgment as part of providing a current services.

- to overcome this the accountant it should appoint necessary staff and regular scritinization of transaction should be taken place

Advocacy threat is where a professional accountant will promote a client’s or employer’s position to the point that the professional accountant’s objectivity is compromised;

- this threat ultimately compromises the independence of accountant therefore the accountant should be very careful in in decisions of the company

Familiarity threat that due to a long or close relationship with a client or employer, a professional accountant will be too sympathetic to their interests or too accepting of their work.

- to avoid this threat the relationship between the organisation and accountant should be in very limited form of manner and all the necessary information should be e promoted to officials in every regular intervals of time.