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87/2005/qd-btc

HỆ THỐNG CHUẨN MỰC KIỂM TOÁN VIỆT NAM. CHUẨN MỰC. ĐẠO ĐỨC NGHỀ NGHIỆP KẾ TOÁN, KIỂM TOÁN (Ban hành và công bố theo Quyết định số 87//QĐ-BTC. Ministry of finance (), The Ministry of finance’s de cision: No. 87//QD-BTC, December 01, , issuin g and an- nouncing standards of ethi cal and professional accountin g and auditing. Quyết định 87//QĐ-BTC của Bộ Tài chính về việc ban hành và công bố Chuẩn mực đạo đức nghề nghiệp kế toán, kiểm toán Việt Nam.

87/2005/qd-btc

Quyết định 87//QĐ-BTC của Bộ Tài chính ban hành ngày 01/12/

Non-audit- restricted use only applicable for certain users. The threats and safeguards identified in this section are generally discussed in the context of interests or relationships between the audit firm, the audit team assurance team and the assurance client.

In the case of a listed audit client, the audit firm and audit team are required to consider the interests and relationships that involve that client and its related entities.

Ideally those entities and the interests and relationships should be identified before signing the audit engagement. The evaluation of threats to independence and subsequent safeguards should be supported by adequate evidence before accepting the engagement and while it is being performed. The obligation to make such an evaluation and take safeguards arises when an audit firm or the audit team knows, or could reasonably be expected to know, of circumstances or relationships that might compromise independence.

There may be occasions when the audit firm, a network firm or an individual inadvertently violates independence in this section.

If such an inadvertent violation occurs, it would generally not compromise independence with respect to an assurance client provided the audit firm has appropriate quality control policies and procedures in place to promote independence and, once discovered, the violation is corrected promptly and any necessary safeguards are applied. Throughout this section, reference is made to significant and clearly insignificant threats in the evaluation of independence. In considering the significance of any particular matter, qualitative as well as quantitative factors should be taken into account.

A matter should be considered clearly insignificant only if it is deemed to be both trivial and inconsequential. Objective and Structure of the Independence Section. The objective of this independence section is to assist audit firms, auditors and the audit teams in:.

In situations when no safeguards are available to reduce the threat to an acceptable level, the only possible actions are to eliminate the activities or interest creating the threat, or to refuse to accept or continue the assurance engagement. The structure of the independence section includes:. The examples discuss threats to independence that may be created by specific circumstances and relationships.

Professional judgment is used to determine the appropriate safeguards to eliminate threats to independence or to reduce them to an acceptable level. In certain examples, the threats to independence are so significant the only possible actions are to eliminate the activities or interest creating the threat, or to refuse to accept or continue the assurance engagement.

In other examples, the threat can be eliminated or reduced to an acceptable level by the application of safeguards. The examples are not intended to be all-inclusive. When threats to independence that are not clearly insignificant are identified, and the audit firm decides to accept or continue the assurance engagement, the decision should be documented.

The documentation should include a description of the threats identified and the safeguards applied to eliminate or reduce the threats to an acceptable level. The evaluation of the significance of any threats to independence and the safeguards necessary to reduce any threats to an acceptable level, takes into account the public interest.

Certain entities may be of significant public interest because, as a result of their business, their size or they have a wide range of shareholders. Examples of such entities might include listed companies, credit institutions, insurance companies. Because of the strong public interest in the financial statements of listed entities, certain paragraphs in this section deal with additional matters that are relevant to the audit of listed entities.

Consideration should be given to the application of the principles set out in this section in relation to the audit of listed entities to other audit clients that may be of significant public interest. National Perspectives. Paragraphs from 77 to of the Code of Ethics provide a conceptual framework for independence requirements for assurance engagements in accordance with the Vietnamese standards.

No person or organization is allowed to apply less stringent standards than those stated in this section. When other provisions of the laws are more stringent, such provisions must be complied still they should comply with all other parts of this section. In such cases, the members of the assurance team and the audit firm should comply with all other parts of this section.

Independence is potentially affected by self-interest, self-review, advocacy, blood-related relationship, other relationship and intimidation threats. Examples of circumstances that may create this threat include, but are not limited to:. Such may be the case if an audit firm or a member of the assurance team were to subordinate their judgment to that of the client.

Examples of circumstances that may create this blood-related family relationship threat include, but are not limited to:. The audit firm and the assurance team have a responsibility to remain independent by taking into account the context in which they practice, the threats to independence and the safeguards available to eliminate the threats or reduce them to an acceptable level.

When threats are identified, other than those that are clearly insignificant, appropriate safeguards should be identified and applied to eliminate the threats or reduce them to an acceptable level.

This decision should be documented. The nature of the safeguards to be applied will vary depending upon the circumstances. The consideration will be affected by matters such as the significance of the threat, the nature of the assurance engagement, the intended users of the assurance report and the structure of the audit firm. Certain safeguards may increase the possibility to detect and deter a violation of the professional conduct.

These safeguards may be brought forwards by the regulatory body, professional bodies or audit firms. Safeguards fall into two broad categories:.

The audit firm and the audit team should select appropriate safeguards to eliminate or reduce threats to independence, other than those that are clearly insignificant, to an acceptable level. Safeguards created by the profession, legislation or regulation, include:. Safeguards within the assurance client b1 include:. Internal audit committee the board of control or its equivalent can have an important corporate governance role when they are independent of client management and can assist the board of directors in satisfying themselves that an audit firm is independent in carrying out its audit role.

Audit firms should establish policies and procedures relating to independence communications with internal audit committees, or others charged with governance.

Matters to be communicated will vary in each circumstance and should be decided by the audit firm, but should generally address the relevant matters set out in this section. This individual could be someone from outside the audit firm or someone within the audit firm or network firm who was not otherwise associated with the audit team;. When the safeguards available, such as those described above, are insufficient to eliminate the threats to independence or to reduce them to an acceptable level, or when an audit firm decides not to eliminate the activities or interests creating the threat, the only course of action available will be the refusal to perform, or withdrawal from, the assurance engagement.

The members of the audit team and the audit firm should be independent of the assurance client during the period of the assurance engagement. The period of the engagement starts when the assurance team begins to perform assurance services and ends when the assurance report is issued, except when the assurance engagement is of a recurring nature for many years.

If the assurance engagement is expected to recur, the period of the assurance engagement ends with the notification by either party that the professional relationship has terminated or the issuance of the final assurance report, whichever is later.

When an entity becomes an audit client during or after the period covered by the financial statements that the audit firm will report on, the audit firm should consider whether any threats to independence may be created by:. Similarly, in the case of an assurance engagement that is not an audit engagement, the audit firm should consider whether any financial or business relationships or previous services may create threats to independence.

If non-assurance services were provided to the audit client during or after the period covered by the financial statements but before the commencement of professional services in connection with the audit and those services would be prohibited during the reporting period of the audit engagement, consideration should be given to the threats to independence, if any, arising from those services.

If the threat is other than clearly insignificant, safeguards should be considered and applied as necessary to reduce the threat to an acceptable level. Such safeguards might include:. Discussing independence issues related to the provision of the non-assurance services with the management of the client;. Precluding personnel who provided the non-assurance services from participating in the audit engagement; and.

Engaging another firm to review the results of the non-assurance services or having another firm re-perform the non-assurance services to the extent necessary to enable it to take responsibility for those services. The previous non-assurance services were permissible under this section for non-listed audit clients;. The services will be terminated within a reasonable period of time of the client becoming a listed entity, if they are impermissible under this section for listed audit clients; and.

The audit firm has implemented appropriate safeguards to eliminate any threats to independence arising from the previous services or reduce them to an acceptable level. A financial interest in an assurance client may create a self-interest threat. In evaluating the significance of the threat, and the appropriate safeguards to be applied to eliminate the threat or reduce it to an acceptable level, it is necessary to examine the nature and materiality of the financial interest.

This includes an evaluation of the role of the person holding the financial interest, the materiality of the financial interest and the type of financial interest direct or indirect.

In evaluating the significance of any threat to independence, it is important to consider the degree of control or influence that can be exercised over the intermediary form, the financial interest held, or its investment strategy. When control exists, the financial interest should be considered direct. Conversely, when the holder of the financial interest has no ability to exercise such control the financial interest should be considered indirect.

Provisions Applicable to All Assurance Clients. If a member of the assurance team, or their direct family member blood-related relationship , has a direct financial interest, or an indirect financial interest, in the assurance client, the self-interest threat created would be so significant the only safeguards available to eliminate the threat or reduce it to an acceptable level would be to:.

If a member of the assurance team, or their direct family member receives, by way of, for example, an inheritance, gift or, as a result of a merger, a direct financial interest or a material indirect financial interest in the assurance client, a self-interest threat would be created.

The following safeguards should be applied to eliminate the threat or reduce it to an acceptable level:. During the period prior to disposal of the financial interest or the removal of the individual from the assurance team, consideration should be given to whether additional safeguards are necessary to reduce the threat to an acceptable level.

When a member of the assurance team knows that his or her direct family member has a direct financial interest or a material indirect financial interest in the assurance client, a self-interest threat may be created. In evaluating the significance of any threat, consideration should be given to the nature of the relationship between the member of the assurance team and the direct family member and the materiality of the financial interest. Once the significance of the threat has been evaluated, safeguards should be considered and applied as necessary.

When an audit firm or a member of the assurance team holds a direct financial interest or a material indirect financial interest in the assurance client as a trustee, a self-interest threat may be created by the possible influence of the trust over the assurance client. Accordingly, such an interest should only be held when:. Consideration should be given to whether a self-interest threat may be created by the financial interests of members outside of the assurance team and their direct family members.

Such individuals would include:. Whether the interests held by such individuals may create a self-interest threat will depend upon factors such as:. The significance of the threat should be evaluated and, if the threat is other than clearly insignificant, safeguards should be considered and applied as necessary to reduce the threat to an acceptable level.

An inadvertent violation of this section as it relates to a financial interest in an assurance client would not impair the independence of the audit firm, the network firm or a member of the assurance team when:. When an inadvertent violation of this section relating to a financial interest in an assurance client has occurred, the audit firm should consider whether any safeguards should be applied. Provisions Applicable to Audit Clients.

If an audit firm, or a network firm, has a direct financial interest in an audit client of the audit firm the self-interest threat created would be so significant no safeguard could reduce the threat to an acceptable level. Consequently, disposal of the financial interest would be the only action appropriate to permit the audit firm to perform the engagement. If an audit firm, or a network firm, has a material indirect financial interest in an audit client of the audit firm a self-interest threat is also created.

The only actions appropriate to permit the audit firm to perform the engagement would be for the audit firm either to dispose of the indirect interest in total or to dispose of a sufficient amount of it so that the remaining interest is no longer material. If an audit firm, or a network firm, has a material financial interest in an entity that has a controlling interest in an audit client, the self-interest threat created would be so significant no safeguard could reduce the threat to an acceptable level.

The only actions appropriate to permit the audit firm to perform the engagement would be for the audit firm, either to dispose of the indirect financial interest in total or to dispose of a sufficient amount of it so that the remaining interest is no longer material.

If the welfare and benefit plan of an audit firm, or network firm, has a financial interest in an audit client a self-interest threat may be created.

Accordingly, the significance of any such threat created should be evaluated and, if the threat is other than clearly insignificant, safeguards should be considered and applied as necessary to eliminate the threat or reduce it to an acceptable level.

Accordingly, such members of the board of directors or their direct family member should not hold any such financial interests in such an audit client. Accordingly, when the lead audit engagement director located in a different office from that of the other members of the assurance team, judgment should be used to determine in which office the lead audit engagement director practice in connection with that audit. If other members of the board of directors and managerial employees who provide non-assurance services to the audit client, except those whose involvement is clearly insignificant, or their direct family member, hold a direct financial interest or a material indirect financial interest in the audit client, the self-interest threat created would be so significant no safeguard could reduce the threat to an acceptable level.

Accordingly, such personnel or their direct family member should not hold any such financial interests in such an audit client. A financial interest in an audit client that is held by a direct family member of a a member of the board of directors located in the office in which the lead audit engagement director practices in an audit engagement, or b a member of the board of directors or managerial employee who provides non-assurance services to the audit client is not considered to create an unacceptable threat provided it is received as a result of their employment rights e.

A self-interest threat may be created if the audit firm, or a member of the assurance team has an interest in an entity and an audit client, or a director, officer or controlling owner thereof also has an investment in that entity. Independence is not compromised with respect to the audit client if the respective interests of the audit firm, the network firm, or member of the assurance team, and the audit client, or director, officer or controlling owner thereof are both immaterial and the audit client cannot exercise significant influence over the entity.

If an interest is material, to either the audit firm, the network firm or the audit client, and the audit client can exercise significant influence over the entity, no safeguards are available to reduce the threat to an acceptable level and the audit firm, or the audit firm, should either dispose of the interest or decline the audit engagement. Any member of the assurance team with such a material interest should either:. If an audit firm has a direct financial interest in an assurance client that is not an audit client the self-interest threat created would be so significant no safeguard could reduce the threat to an acceptable level.

If an audit firm has a material indirect financial interest in an assurance client that is not an audit client a self-interest threat created would also be so significant that no safeguard could reduce the threat to an acceptable level. The only action appropriate to permit the audit firm to perform the engagement would be for the audit firm to either dispose of the indirect interest in total or to dispose of a sufficient amount of it so that the remaining interest is no longer material.

If an audit firm has a material financial interest in an entity that has a controlling interest in an assurance client that is not an audit client, the self-interest threat created would be so significant no safeguard could reduce the threat to an acceptable level.

The only action appropriate to permit the audit firm to perform the engagement would be for the audit firm either to dispose of the financial interest in total or to dispose of a sufficient amount of it so that the remaining interest is no longer material.

When a restricted use report for an assurance engagement that is not an audit engagement is issued, exceptions to the provisions in paragraphs through and through are set out in paragraph A loan from, or a guarantee thereof by, an assurance client that is a bank or a similar institution, to the audit firm would not create a threat to independence provided the loan is made under normal lending procedures, terms and requirements and the loan is immaterial to both the audit firm and the assurance client.

If the loan is material to the assurance client or the audit firm it may be possible, through the application of safeguards, to reduce the self-interest threat created to an acceptable level. Such safeguards might include involving an additional practicing auditor from outside the audit firm, or network firm, to review the work performed. A loan from, or a guarantee thereof by, an assurance client that is a bank or a similar institution, to a member of the assurance team or their direct family would not create a threat to independence provided the loan is made under normal lending procedures, terms and requirements.

Examples of such loans such as home mortgages, bank overdrafts, car loans and credit card balances. Similarly, deposits made by, or current accounts of, an audit firm or a member of the assurance team with an assurance client that is a bank, broker or similar institution would not create a threat to independence provided the deposit or account is held under normal commercial terms.

Similarly, if the audit firm or a member of the assurance team accepts a loan from, or has borrowing guaranteed by, an assurance client that is not a bank or similar institution, the self-interest threat created would be so significant no safeguard could reduce the threat to an acceptable level, unless the loan or guarantee is immaterial to both the audit firm or the member of the assurance team and the assurance client.

The examples in paragraphs through relate to loans and guarantees between the audit firm and an assurance client. In the case of an audit engagement, the provisions should be applied to the audit firm, all network firms and the audit client. Close Business Relationships with Assurance Clients. A close business relationship between an audit firm or a member of the assurance team and the assurance client or its management, or between the audit firm, an audit firm and an audit client, will involve a commercial or common financial interest and may create self-interest and intimidation threats.

The following are examples of such relationships:. In the case of an audit client, unless the financial interest is immaterial and the relationship is clearly insignificant to the audit firm, the network firm and the audit client, no safeguards could reduce the threat to an acceptable level.

In the case of an assurance client that is not an audit client, unless the financial interest is immaterial and the relationship is clearly insignificant to the audit firm and the assurance client, no safeguards could reduce the threat to an acceptable level.

Consequently, in both these circumstances the only possible courses of action are to:. Unless any such financial interest is immaterial and the relationship is clearly insignificant to the member of the assurance team, the only appropriate safeguard would be to remove the individual from the assurance team. In the case of an audit client, business relationships involving an interest held by the audit firm, a network firm or a member of the assurance team or their direct family member in a closely held entity when the audit client or a Director or officer of the audit client, or any group thereof, also has an interest in that entity, do not create threats to independence provided:.

However, such transactions may be of a nature or magnitude so as to create a self-interest threat. If the threat created is other than clearly insignificant, safeguards should be considered and applied as necessary to reduce the threat to an acceptable level.

Family and personal relationships between a member of the assurance team and a Director, a senior managerial employee or certain employees, depending on their role, of the assurance client, may create self-interest, blood-related family relationship, other relationships or intimidation threats. It is impracticable to attempt to describe in detail the significance of the threats that such relationships may create. Consequently, there is a wide spectrum of circumstances that will need to be evaluated and safeguards to be applied to reduce the threat to an acceptable level.

When a direct family member of a member of the assurance team is a director, a senior managerial employee or an employee of the assurance client in a position to exert direct and significant influence over the subject matter of the assurance engagement, or was in such a position during any period covered by the engagement, the threats to independence can only be reduced to an acceptable level by removing the individual from the assurance team.

The closeness of the relationship is such that no other safeguard could reduce the threat which affects the independence to an acceptable level. If application of this safeguard is not used, the only course of action is to withdraw from the assurance engagement.

When a direct family member of a member of the assurance team is a Director, a senior managerial employee, or an employee of the assurance client in a position to exert direct and significant influence over the subject matter of the assurance engagement, threats to independence may be created. The significance of the threats will depend on factors such as:. In addition, self-interest, blood-related family relationship or intimidation threats may be created when a person who is other than a direct family member of a member of the assurance team has a close relationship with the member of the assurance team and is a director, a senior managerial employee or an employee of the assurance client in a position to exert direct and significant influence over the subject matter of the assurance engagement.

Therefore, members of the assurance team are responsible for identifying any such persons with such relationship and for consulting in accordance with firm procedures. The evaluation of the significance of any threat created and the safeguards appropriate to eliminate the threat or reduce it to an acceptable level will include considering matters such as the closeness of the relationship and the role of the individual within the assurance client.

Consideration should be given to whether self-interest, blood-related family relationship or intimidation threats may be created by a personal or family relationship between a Director or employee of the audit firm who is not a member of the assurance team and a director, a senior managerial employee or an employee of the assurance client in a position to exert direct and significant influence over the subject matter of the assurance engagement.

Therefore, Directors and employees of the audit firm are responsible for identifying any such relationships and for consulting in accordance with firm procedures. The evaluation of the significance of any threat created and the safeguards appropriate to eliminate the threat or reduce it to an acceptable level will include the consideration of matters such as the closeness of the relationship, the interaction of the audit firm professional with the assurance team, the position held within the audit firm, and the role of the individual within the assurance client.

An inadvertent violation of this section as it relates to blood-related family and personal relationships would not impair the independence of an audit firm or a member of the assurance team when:. When an inadvertent violation of this section relating to blood-related family and personal relationships has occurred, the audit firm should consider whether any safeguards should be applied.

Such circumstances may create self-interest, familiarity and intimidation threats particularly when significant connections remain between the individual and his or her former firm. If a member of the assurance team, Director or former Director of the audit firm has joined the assurance client.

The significance of the self-interest, familiarity, blood-related family relationship, other relationships or intimidation threats created will depend upon the following factors:. The significance of the threat should be evaluated and, if the threat is other than clearly insignificant, safeguards should be considered and applied to reduce the threat to an acceptable level.

In all cases, all of the following safeguards are necessary to reduce the threat to an acceptable level:. This threat can be reduced to an acceptable level by the application of all of the following safeguards:. In addition, consideration should be given to performing an independent review of any significant judgments made by that individual while on the engagement.

To have a former officer, Director or employee of the assurance client serve as a member of the assurance team may create self-interest, self-review and familiarity threats. This would be particularly true when a member of the assurance team has to report on, for example, subject matter he or she had prepared or elements of the financial statements he or she had prepared while with the assurance client.

If, during the assurance report, a member of the assurance team had served as an officer or Director of the assurance client, or had been an employee in a position to exert direct and significant influence over the subject matter of the assurance engagement, the threat created would be so significant no safeguard could reduce the threat to an acceptable level.

Such individuals should not be assigned to the assurance team. If, prior to the assurance report, a member of the assurance team had served as an officer or director of the assurance client, or had been an employee in a position to exert direct and significant influence over the subject matter of the assurance engagement, this may create self-interest, self-review and familiarity threats. For example, such threats would be created if a decision made or work performed by the individual in the prior period, while employed by the assurance client, is to be evaluated in the current period as part of the current assurance engagement.

The significance of the threats will depend upon factors such as:. The significance of the threat should be evaluated and, if the threat is other than clearly insignificant, safeguards should be applied as necessary to reduce the threat to an acceptable level. If member of the board of directors or employee providing services professional staff of the audit firm serves as a member of the board of director or as a member of the board of management of an assurance client the self-review and self-interest threats created would be so significant no safeguard could reduce the threats to an acceptable level especially in the case of an audit engagement.

Consequently, if such an individual were to accept such a position the only course of action is to refuse to perform, or to withdraw from the assurance engagement. If an employee has significant influence to the personnel management and the maintenance of company records and registers, to duties as diverse as ensuring that the company complies with regulations or providing advice on corporate governance matters such as assistant to the director, chief accountant , that position may create self-review and advocacy threats.

If a member of the board of directors or employee of the audit firm exerts significant influence on an audit client the self-review and advocacy threats created would generally be so significant, no safeguard could reduce the threat to an acceptable level. If a person of the audit firm performs routine administrative and secretarial function of the client, that work is generally not perceived to impair independence, provided client management makes all relevant decisions. Using the same auditor on an assurance engagement over a long period of time may create a familiarity threat.

The significance of the threat will depend upon factors such as:. Audit Clients that are Listed Entities. When using the same lead audit engagement director and practicing auditor on an audit over a prolonged period may create a familiarity threat. This threat is particularly relevant in the context of the audit of listed entities. Where audit for the listed entities, the safeguards include:.

When an audit client becomes a listed entity, the lead audit engagement director, the practicing auditor and the quality reviewer should be rotated earlier. While the lead audit engagement director, the practicing auditor and the quality reviewer should be rotated after such a pre-defined period, some degree of flexibility over timing of rotation may be necessary in certain circumstances.

Examples of such circumstances include:. In all such circumstances, if within 3 years the rotation has not been carried out all safeguards should be applied to reduce any threats to an acceptable level. When an audit firm has only 2 members of the board of directors, besides the rotation, safeguards may include the involvement of additional practicing auditors who are not engaged in the assurance team to review the audit or for consultation as necessary.

If an audit firm has only one audit director with the necessary knowledge and experience to serve as the lead engagement director on an audit client that is a listed entity, safeguards to minimize the threat to acceptable level include:.

Audit firms have traditionally provided to their assurance clients a range of non-assurance services that are consistent with their skills and expertise. Assurance clients value the benefits that derive from having these firms, who have a good understanding of the business, bring their knowledge and skill to bear in other areas.

The provision of non-assurance services may, however, create threats to the independence of the audit firm, a network firm or the members of the assurance team, particularly with respect to perceived threats to independence.

Consequently, it is necessary to evaluate any threat created by the provision of such services. In some cases it may be possible to eliminate or reduce the threat created by application of safeguards. In other cases no safeguards are available to reduce the threat to an acceptable level. The following activities would generally create self-interest or self-review threats that are so significant that only avoidance of the activity or refusal to perform the assurance engagement would reduce the threats to an acceptable level:.

The examples set out in paragraphs through are addressed in the context of the provision of non-assurance services to an assurance client. The potential threats to independence will most frequently arise when a non-assurance service is provided to an audit client. The financial statements of an entity provide financial information about a broad range of transactions and events that have affected the entity.

The subject matter of other assurance services, however, may be limited in nature. Threats to independence, however, may also arise when an audit firm provides a non-assurance service related to the subject matter of a non-audit assurance engagement.

When the non-assurance service is not related to the subject matter of the non-audit assurance engagement, the threats to independence will generally be clearly insignificant. The following activities may also create self-review or self-interest threats:. The significance of any threat created should be evaluated and, if the threat is other than clearly insignificant, safeguards should be considered and applied as necessary to eliminate the threat or reduce it to an acceptable level.

New developments in business, the evolution of financial markets, rapid changes in information technology, and the consequences for management and control, make it impossible to draw up an all-inclusive list of all situations when providing non-assurance services to an assurance client might create threats to independence and of the different safeguards that might eliminate these threats or reduce them to an acceptable level. In general, however, an audit firm may provide services beyond the assurance engagement provided any threats to independence have been reduced to an acceptable level.

The following safeguards may be particularly relevant in reducing to an acceptable level threats created by the provision of non-assurance services to assurance clients:. Before the audit firm accepts an engagement to provide a non-assurance service to an assurance client, consideration should be given to whether the provision of such a service would create a threat to independence. In situations when a threat created is other than clearly insignificant, the non-assurance engagement should be declined unless appropriate safeguards can be applied to eliminate the threat or reduce it to an acceptable level.

The provision of certain non-assurance services to audit clients may create threats to independence so significant that no safeguard could eliminate the threat or reduce it to an acceptable level. Preparing Accounting Records and Financial Statements for audit clients. Assisting an audit client in matters such as preparing accounting records or financial statements may create a self-review threat when the financial statements are subsequently audited by the audit firm.

It is the responsibility of client management to ensure that accounting records are kept and financial statements are prepared, although they may request the audit firm to provide assistance. If firm, or network firm, personnel providing such assistance make management decisions, the self-review threat created could not be reduced to an acceptable level by any safeguards. Consequently, personnel should not make such decisions. Examples of such managerial decisions include:.

The audit process involves extensive dialogue between the audit firm and management of the audit client. During this process, management requests and receives significant input regarding such matters as accounting principles and financial statement disclosure, the appropriateness of controls and the methods used in determining the stated amounts of assets and liabilities. Technical assistance of this nature and advice on accounting principles for audit clients are an appropriate means to promote the fair presentation of the financial statements.

Similarly, the audit process may involve assisting an audit client in resolving account reconciliation problems, analyzing and accumulating information for regulatory reporting, assisting in the preparation of consolidated financial statements including the translation of local statutory accounts to comply with group accounting policies and the transition to a different reporting framework , drafting disclosure items, proposing adjusting journal entries and providing assistance and advice in the preparation of local statutory accounts of subsidiary entities.

These services are considered to be a normal part of the audit process and do not, under normal circumstances, threaten independence. The examples in paragraphs through indicate that self-review threats may be created if the audit firm is involved in the preparation of accounting records or financial statements and those financial statements are subsequently the subject matter of an audit engagement of the audit firm.

This notion may be equally applicable in situations when the subject matter of the assurance engagement is not financial statements.

For example, a self-review threat would be created if the audit firm developed and prepared prospective financial information and subsequently provided assurance on this prospective financial information.

Consequently, the audit firm should evaluate the significance of any self-review threat created by the provision of such services. If the self-review threat is other than clearly insignificant safeguards should be considered and applied as necessary to reduce the threat to an acceptable level.

Audit Clients that are Not Listed Entities. The audit firm, or a network firm, may provide an audit client that is not a listed entity with accounting and bookkeeping services according to agreed upon procedures provided any self-review threat created is reduced to an acceptable level.

Examples of such services include:. The significance of any threat created should be evaluated and, if the threat is other than clearly insignificant, safeguards should be considered and applied as necessary to reduce the threat to an acceptable level. The provision of accounting and bookkeeping services, and the preparation of financial statements or financial information which forms the basis of the financial statements on which the audit report is provided, on behalf of an audit client that is a listed entity, may impair the independence of the audit firm or network firm, or at least give the appearance of impairing independence.

Accordingly, no safeguard other than the prohibition of such services, except in emergency situations and when the services fall within the external audit mandate, could reduce the threat created to an acceptable level.

Therefore, an audit firm or a network firm should not, with the limited exceptions below, provide such services to listed entities which are audit clients.

If such services are provided, all of the following safeguards should be applied:. The provision of accounting and bookkeeping services to audit clients in emergency or other unusual situations, when it is impractical for the audit client to make other arrangements, would not be considered to pose an unacceptable threat to independence provided:.

A valuation is the estimation of assumed values with regard to future developments, the application of certain methodologies and techniques, and the combination of both in order to compute a certain value for an asset, a liability or for a business as a whole. If the valuation service involves the valuation of matters material to the financial statements and the valuation involves a significant degree of subjectivity, the self-review threat created could not be reduced to an acceptable level by the application of any safeguard.

Accordingly, such valuation services should not be provided or, alternatively, the only course of action would be to withdraw from the audit engagement.

Performing valuation services that are neither separately, nor in the aggregate, material to the financial statements, or that do not involve a significant degree of subjectivity, may create a self-review threat that could be reduced to an acceptable level by the application of safeguards. In determining whether the above safeguards would be effective, consideration should be given to the following matters:.

When an audit firm, or a network firm, performs a valuation service for an audit client for the purposes of making a filing or return to a tax authority, computing an amount of tax due by the assurance client, or for the purpose of tax planning, stock issuing, this would not create a significant threat to independence because such valuations are generally subject to external review, for example by a tax authority, stock exchange center.

When the audit firm performs a valuation that forms part of the subject matter of an assurance engagement that is not an audit engagement, the audit firm should consider any self-review threat. If the threat is other than clearly insignificant, safeguards should be applied as necessary to eliminate or reduce the threat to an acceptable level. Provision of Taxation Services to Audit Clients.

The audit firm may be asked to provide taxation services to an audit client. Taxation services comprise a broad range of services, including tax compliance, tax planning, provision of formal taxation opinions and assistance in the resolution of tax disputes. Such assignments are generally not considered to create threats to independence. A self-review threat may be created when an audit firm, or network firm, provides internal audit services to an audit client.

In evaluating any threats to independence, it is necessary to consider the nature of the internal audit service. For this purpose, internal audit services do not include operational internal audit services unrelated to the internal accounting controls, financial systems or financial statements. When the audit firm, or a network firm, provides an internal audit service or part of this service to an external audit client, any self-review threat may be reduced to an acceptable level by ensuring that there is a clear separation between the management and control of the internal audit by the audit client management and the internal audit activities themselves.

Appropriate safeguards should be put in place and the audit firm, or network firm, should, in particular, ensure that the audit client acknowledges its responsibilities for establishing, maintaining and monitoring the system of internal controls.

Safeguards to be applied in all circumstances to reduce any threats to an acceptable level include ensuring that:. Consideration should also be given to whether such non-assurance services should be provided only by personnel not involved in the audit engagement and with different reporting lines within the audit firm. The self-review threat is likely to be too significant to allow the provision of such services to an audit client unless appropriate safeguards are put in place ensuring that:.

The significance of the threat, if any, should be evaluated and, if the threat is other than clearly insignificant, safeguards should be considered and applied as necessary to eliminate the threat or reduce it to an acceptable level. The provision of services in connection with the assessment, design and implementation of internal accounting controls and risk management controls are not considered to create a threat to independence provided that firm or network firm personnel do not perform management functions.

Temporary Staff Assignments to Audit Clients. Each situation should be carefully analyzed to identify whether any threats are created and whether appropriate safeguards should be implemented. Safeguards that should be applied in all circumstances to reduce any threats to an acceptable level include:. Litigation support services may include such activities as acting as an expert lawyer , witness, calculating estimated damages or other amounts that might become receivable or payable as the result of litigation or other legal dispute, and assistance with document management and retrieval in relation to a dispute or litigation.

A self-review threat may be created when the litigation support services provided to an audit client include the estimation of the possible outcome and thereby affects the amounts or disclosures to be reflected in the financial statements.

The significance of any threat created will depend upon factors such as:. The audit firm, or network firm, should evaluate the significance of any threat created and, if the threat is other than clearly insignificant, safeguards should be considered and applied as necessary to eliminate the threat or reduce it to an acceptable level.

If the role undertaken by the audit firm or network firm involved making managerial decisions on behalf of the audit client, the threats created could not be reduced to an acceptable level by the application of any safeguard. Therefore, the audit firm or network firm should not perform this type of service for an audit client. Provision of Legal Services to Audit Clients.

Legal services are defined as any services for which the person providing the services must either be admitted to practice before the Courts of the jurisdiction in which such services are to be provided, or have the required legal training to practice law.

The provision of legal services by an audit firm, or network firm, to an entity that is an audit client may create both self-review and advocacy threats. The safeguards set out in paragraph may be appropriate in reducing any threats to independence to an acceptable level. In circumstances when the threat to independence cannot be reduced to an acceptable level the only available action is to decline to provide such services or withdraw from the audit engagement.

The provision of legal services to an audit client which involve matters that would not be expected to have a material effect on the financial statements are not considered to create an unacceptable threat to independence.

There is a distinction between advocacy and advice. Legal services to support an audit client in the execution of a transaction e. Such a service would not generally impair independence, provided that:. Acting for an audit client in the resolution of a dispute or litigation in such circumstances when the amounts involved are material in relation to the financial statements of the audit client would create advocacy and self-review threats so significant no safeguard could reduce the threat to an acceptable level.

Therefore, the audit firm should not perform this type of service for an audit client. When an audit firm is asked to act in an advocacy role for an audit client in the resolution of a dispute or litigation in circumstances when the amounts involved are not material to the financial statements of the audit client, the audit firm should evaluate the significance of any advocacy and self-review threats created and, if the threat is other than clearly insignificant, safeguards should be considered and applied as necessary to eliminate the threat or reduce it to an acceptable level.

The appointment of a member of board of directors or an employee of the audit firm or network firm as general counsel for legal affairs to an audit client would create self-review and advocacy threats that are so significant no safeguards could reduce the threats to an acceptable level. The position of general counsel is generally a senior management position with broad responsibility for the legal affairs of a company and consequently, no member of the audit firm or network firm should accept such an appointment for an audit client.

Recruiting Senior Management to Audit Clients. The recruitment of senior management for an assurance client, such as those in a position to affect the subject of the assurance engagement, may create current or future self-interest, familiarity and intimidation threats.

The audit firm could generally provide such services as reviewing the professional qualifications of a number of applicants and provide advice on their suitability for the post. In addition, the audit firm could generally produce a short-list of candidates for interview, provided it has been drawn up using criteria specified by the assurance client. Circular TT-BTC guiding the executing of tax liability applicable to foreign organizations, individuals doing business or earning incomes in vietnam.

Circular TT-BTC, April 12, guiding the executing of tax liability applicable to foreign organizations, individuals doing business or earning incomes in vietnam. Guiding a number of articles of the law on tax administration. Viet Nam Law on Independent Audit,. This Law regulates the principles, conditions, scope, and form of independent audit activities; the rights and obligations of practicing auditors, auditing firms, branches of foreign auditing firms in Vietnam and the units that are audited.

Personal Income Tax in Viet Nam. Goldenstar offer a wide range of compliance, advisory and administrative services to international and local organisations to help them and their employees manage their affairs with the numerous rules impacting their employment in Vietnam.

Quyết định số 87/2005/QĐ-BTC

BỘ TÀI CHÍNH CỘNG HOÀ XÃ HỘI CHỦ NGHĨA VIỆT NAM ***** Độc lập - Tự do - Hạnh phúc ***** Số: 87//QĐ-BTC Hà Nội, ngày 01 tháng 12 năm QUYẾT ĐỊNH VỀ VIỆC BAN HÀNH VÀ CÔNG BỐ CHUẨN MỰC ĐẠO ĐỨC NGHỀ NGHIỆP KẾ TOÁN, KIỂM TOÁN VIỆT NAM BỘ TRƯỞNG BỘ TÀI CHÍNH Căn cứ Luật Kế toán số 03//QH11 ngày 17/6. Dec 01,  · Quyết định 87//QĐ-BTC ban hành và công bố Chuẩn mực đạo đức nghề nghiệp kế toán, kiểm toán Việt Nam của Bộ trưởng Bộ Tài chính ban hành. Dec 01,  · Code of ethics for accountancy and auditing profession in Viet Nam Issued under Decision 87//QD-BTC dated 1 December of the Minister of Finance CODE OF ETHICS FOR VIETNAM STANDARDS ON AUDITING SYSTEM ACCOUNTANCY AND AUDITING PROFESSION. Tags:What is mining bitcoins wiki, Menace webcam bitcoin, Bitcoin.cpucap.com review, Amazon bitcoin domain names, Trading bitcoin beginner

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