ACCA考试F6每日一练(2019-03-14)

正确答案：
(b) Wallace Co
Being the audit manager, Valerie Hobson is clearly in a position to influence the outcome of the audit. She appears to have
entered into a private commercial transaction with her client. IFAC’s Code of Ethics for Professional Accountants does not
prohibit such commercial transactions so long as they are:
– In the normal course of business,
– At arm’s length, and
– The value is not material to either party.
In this case the transaction is in the normal course of business for the client. Rental of storage space is not the main business
of Wallace Co, but it appears that this type of transaction is quite common for the company. However the note on the invoice
indicates that a substantial discount has been offered and accepted, and so the transaction is not at arm’s length. The value
is not material to Wallace Co, but could represent a significant discount to normal commercial terms to the audit manager.
Goods and services can be received from an audit client, but only if the value is clearly insignificant.
A self-interest threat is clearly established. Valerie Hobson is benefiting financially from her position as audit manager. She
may compromise the audit approach – which has recently been planned – and furthermore she may compromise the audit
opinion to keep the client happy. She may also have other audit clients where bias could have occurred.
Action to be taken:
– The ethics partner will need to evaluate whether the value of the transaction and the discount received is ‘clearly
insignificant’.
– Her benefiting from a discount on services provided by Wallace Co, which was not disclosed, could result in disciplinary
action.
– Valerie should be removed from the audit immediately, and a new audit manager assigned to Wallace Co.
– The audit planning for year ended 31 May 2008 should be subject to independent review and amendments made where
necessary.
– The transaction should be disclosed to the audit committee of Wallace Co, or to those charged with governance.
– The ethics partner may wish to consider Valerie’s relationships with other audit clients for any evidence of transactions
or other indicators of potential bias.

正确答案：

正确答案：

 

正确答案：
(c) Retirement by rotation.
Definition
Retirement by rotation is an arrangement in a director’s contract that specifies his or her contract to be limited to a specific
period (typically three years) after which he or she must retire from the board or offer himself (being eligible) for re-election.
The director must be actively re-elected back onto the board to serve another term. The default is that the director retires
unless re-elected.
Importance of
Retirement by rotation reduces the cost of contract termination for underperforming directors. They can simply not be
re-elected after their term of office expires and they will be required to leave the service of the board as a retiree (depending
on contract terms).
It encourages directors’ performance (they know they are assessed by shareholders and reconsidered every three years) and
focuses their minds upon the importance of meeting objectives in line with shareholders’ aims.
It is an opportunity, over time, to replace the board membership whilst maintaining medium term stability of membership
(one or two at a time).
Applied to Rosh
Retirement by rotation would enable the board of Rosh to be changed over time. There is evidence that some directors may
have stayed longer than is ideal because of links with other board members going back many years.