Auditor Independence Promoting The Company Assignment

Auditor Independence
Student’s Name
Institutional Affiliation
Auditor Independence
Question One
Situation 1
In this situation, LTH is requesting CJI to take part in their next seminar in promoting the company in order to attract to more investors. Here, LTH threatens that if CJI refuses to take part in the seminar, it might discontinue its relationship. According to AICPA guidelines, an auditor is not supposed to be involved in any activities that are aimed at promoting the client to the public. The integrity and objectivity of the auditor is jeopardized here since the auditor will focus on ensuring that his report reflects what he said at the seminar. Although, CJI’s relationship with LTH is at stake here, CJI has to consider how this will affect their objectivity and integrity as well. In this situation, CJI is in a dilemma of whether to promote LTH or not.
Threat.
In this situation, the auditor is faced with advocacy threat. It is among the five threats that are listed under IESBA. This ...