What are examples of direct financial interests that would impair an auditor’s independence?
There are certain types of direct financial interests that will impair an auditor’s independence automatically – materiality is not a factor!
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What are the three types of threats to independence?
When conducting audits for both issuers and nonissuers, auditors must sustain independence. The auditor must be independent in mind and in appearance. There are several threats to specific engagement circumstances that might impair an auditor from sustaining independence. The visual below illustrates the three main types: