Types of Self Interest Threats.

Q23.Explain types of self interest threats.
Ans.

  1. Self interest threats for finance and accounting professionals working as consultant or auditors are given below:
    1. A financial interest in a client or jointly holding the financial interest with a client.
    2. Undue dependence on total fees from a client.
    3. Having a close business relationship with a client
    4. Concern about the possibility of losing a client.
    5. Potential employment with a client.
  2. Self interest threat for finance and accounting professionals working as an employee are given below:
    1. Financial interests, loans and guarantees in the company in which the professionals is working.
    2. Incentive compensation arrangements.
    3. Inappropriate personal use of Corporate assets.
    4. Concern over employment security.

 

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