When A Client Accepts The Services Of An Accountant Without An Agreement Concerning Payment
The last point is important because it is related to corporate governance. According to many corporate governance codes, including the UK Corporate Governance Code, the client`s audit committee should be involved in any decision as to whether the audit firm can be responsible for providing a non-audit service. Therefore, when it has committed to obtaining a non-audit service for an audit mandate, a thorough discussion should take place with the governance officials, including the audit committee, in order to obtain approval of the commitment to continue. In addition to verifying independence and objectivity, audit firms should remember that fundamental ethical principles apply to non-audit services, as well as audits. Therefore, when considering whether a non-audit service should be performed, the company should assess its competence in the performance of the work, assess whether confidentiality is a problem and be able to comply with all relevant laws and regulations. As noted above, candidates` responses to non-exam service requirements must apply knowledge to the scenario in order to score points. Relevance for ACCA Qualification Paper P7 The P7, Advanced Audit and Assurance paper program covers professional appointments (Syllabus C4 reference). Learning achievements include explaining the issues to be considered and the procedures that should be followed by a company before accepting a new customer, a new commitment to an existing customer, or agreement on the terms of a new commitment. The commitment may be a review or non-audit or insurance commitment.
Acceptance decisions are essential because new customers and/or commitments can pose a threat to objectivity or create risk exposure to the business, which must be carefully assessed. One of the current issues discussed in this profession is whether the provision of non-audit services to audit clients should be banned altogether. In addition, new requirements from the International Standard on Auditing (ISA) require the company to verify whether the conditions of an audit are met when there is a new audit commitment. All of these factors mean that acceptance decisions must be made with caution. According to IFAC`s Code of Ethics for Accountants, “Before adopting a new relationship with clients in public practice, a professional accountant must decide whether acceptance would pose a threat to adherence to the basic principles.