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ACCA Applied Knowledge · Business and Technology · Ethical conflicts and dilemmas

An accountant is asked by her employer to prepare a tax computation. She holds 30% of the shares in a supplier whose invoices affect the figures, and she has not told anyone. Which type of threat does this situation mainly create?

It mainly creates a self-interest threat. Her 30% shareholding in the supplier gives her a financial interest that could influence her judgement when handling figures affected by that supplier, whereas intimidation, familiarity and advocacy threats involve pressure, close relationships or promoting a position.

  1. ASelf-interest threatCorrect
  2. BIntimidation threat
  3. CFamiliarity threat
  4. DAdvocacy threat

Explanation

A financial interest in a supplier could influence her judgement for personal gain, which is a self-interest threat. There is no pressure or fear (intimidation), no close long-standing relationship (familiarity), and she is not promoting the employer's position (advocacy).

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