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Write an answer to the situation described below addressing the required criteria (i.e. 1 &...

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Accounting

Write an answer to the situation described below addressing the required criteria (i.e. 1 & 2) in each independent case. You may use a tabulated format if helpful having Threats, Safeguards and Objective Assessment as column headings.

Christopher Brown has been appointed as a junior auditor of Apex Chartered Accountants (ACA). One of his first tasks is to review the firms audit clients (all public interest entities) to ensure that independence requirements of APES 110 (Code of Ethics for Professional Accountants) are being met. His review has revealed the following:

  1. (a) Michelle, FCPA, is the engagement partner on the audit of Blue Steel Limited (BSL). Andrew Ferguson, FCPA, is not involved in the BSL audit but practices in the same office as Michelle. Andrews wife Susan recently obtained a minor ownership interest (around 4%) in BSL as a result of a merger

For each of the independent situations above, and using the conceptual framework in APES 110 (Code of Ethics for Professional Accountants), answer the following questions:

1. Identify potential threat(s) to independence & recommend safeguards (if any) to reduce the independence threat(s) identified.

2. Provide an objective assessment of whether audit independence can be achieved

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