REVIEWER (401) - COE
1. Which statement is incorrect regarding employed professional accountants?
When undertaking significant tasks for which a professional accountant has not had sufficient
specific training or experience, he or she should not mislead the employer as to the degree of
expertise or experience he or she possesses, and where appropriate, expert advice and assistance
should be sought.
A professional accountant, particularly one having authority over others, should give due weight
for the need for them to develop and hold their own judgment in accounting matters and should
deal with difference of opinion in a professional way.
Employed professional accountants owe a duty of loyalty to their employer as well as to the
profession, therefore there may be no time that the two will be in conflict.
A professional accountant is expected to present financial information fully, honestly and
professionally and so that it will be understood in its context.
2. Which of the following is incorrect regarding confidentiality?
Confidentiality should always be observed by a professional accountant unless specific authority
has been given to disclose information or there is a legal or professional duty to disclose.
Confidentiality requires that a professional accountant acquiring information in the course of
performing professional services neither uses nor appear to use that information for personal
advantage or for the advantage of a third party.
The duty of confidentiality ceases after the end of the relationship between the professional
accountant and the client or employer.
Professional accountants have an obligation respect the confidentiality of information about a
client's or employer's affairs acquired in the course of professional services.
3. Assurance engagement include the following, except
An engagement conducted to provide a high level of assurance that the subject matter conforms
in all material respects with identified suitable criteria.
An engagement conducted to provide a moderate level of assurance that the subject matter is
plausible in the circumstances.
An engagement in accordance with the Philippine Standard on Assurance Engagement(s) issued
by the Philippine Auditing Standards and Practices Council as approved by the Board of
Accountancy/Professional Regulation Commission.
An engagement to perform agreed-upon procedures.
4. Which statement is incorrect regarding long association of senior personnel with audit clients that are
listed entities?
Using the same lead engagement partner on an audit over a prolonged period may create a
familiarity threat.
When audit client becomes a listed entity the length of time the lead engagement partner has
served the audit client in that capacity should be considered in determining when the partner
should rotated.
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