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ACCA Applied Knowledge · Business and Technology · Fundamental principles of ethical behaviour

Bright Ltd's accountant prepared the company's year-end accounting entries. Later, the same accountant is asked to review the accuracy of those entries as part of an assurance engagement. Which threat does this create?

This creates a self-review threat. The accountant would be evaluating the results of their own earlier work, so they may not objectively identify mistakes or challenge their own judgements, which compromises objectivity in the assurance engagement.

  1. ASelf-interest threat
  2. BSelf-review threatCorrect
  3. CAdvocacy threat
  4. DIntimidation threat

Explanation

A self-review threat arises when a professional must re-evaluate judgements or work they or their firm previously performed. Reviewing one's own entries makes errors less likely to be found. Self-interest involves a financial or other personal interest, which is not described here.

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