Which of the following scenarios should raise a concern about auditor independence?
Which of the following scenarios should raise a concern about auditor independence?
Auditor independence is compromised if the auditor has been involved in consulting on the implementation portion of a project they are later auditing. This involvement can create a significant conflict of interest, as the auditor may be reluctant to criticize work they recommended or were involved in. Their objectivity can be compromised because they might have a vested interest in the outcome of the project. Therefore, option B is the scenario that should raise a concern about auditor independence.
yeap it must be B
shouldn't this be B?
D. The auditor has a personal relationship with an end user. Auditor independence is a critical aspect of the auditing process to ensure that auditors can provide unbiased and objective opinions about the financial statements and other matters they are auditing. In this context, a personal relationship between the auditor and an end user (client personnel) can raise concerns about independence because it may compromise the auditor's ability to remain impartial and objective when evaluating the client's financial information. Such a relationship can create the perception that the auditor may not be able to provide an unbiased assessment of the client's financial statements or internal controls. Therefore, option D is the scenario that should raise a concern about auditor independence.
For auditors to maintain independence, they should avoid situations that could be perceived as compromising their judgment. In this case, consulting on the implementation creates a conflict of interest.