What are the concepts of ethical threats to independence

Assignment Help Accounting Basics

Reference no: EM132670089

A financial scandal has swept through London and the United Arab Emirates, centered on allegations of fraud at two companies. Both NMC Health Plc and Finablr Plc have had their shares suspended in London, with NMC losing its place in the FTSE 100 index of leading U.K.-listed companies.

The Middle East's largest hospital operator had overpaid for assets, inflated cash balances and understated debt. NMC shares plunged, falling by more than 60% by the time they were halted on the London Stock Exchange in February -- barely 2.5 years after joining the likes of HSBC Holdings Plc and AstraZeneca Plc in the FTSE 100. An investigation instigated by NMC founder Shetty uncovered "serious fraud and wrongdoing."
NMC's external auditor Ernst & Young LLP never publicly raised concerns over NMC's financial statements. The U.K. accounting regulator has opened a probe into Ernst & Young's audit of NMC's 2018 financial statements. (Adapted from Bloomberg, 12 May 2020)
In recent years, we have witnessed several accounting scandals, such as NMC Health Plc above despite auditors expressing an unmodified audit opinion (i.e. true and fair view).

Required

Question 1: What is the key focus/purpose of your essay?

Question 2: Explain what are the threats faced.

Question 3: What is the overview of the fundamental principles of the Code of Professional Conduct and Ethics?

Question 4: What are the concepts of ethical threats to independence which might have impaired their objectivity, resulting in the audit failure?

Question 5: What are the consequences on decision making of financial statement users when auditors fail to detect material misstatements on the financial statements? And support your arguments.

Reference no: EM132670089

Questions Cloud

Compute the profit to be earned under each alternative : Compute the profit to be earned under each alternative. Increase selling price by 10% with no change in total variable costs. Reduce fixed costs by $11,360.

What percent will the price of the bonds increase maturity : What is the current price of the bonds? Lance Whittingham IV specializes in buying deep discount bonds. These represent bonds that are trading at well

Prepare summary of journal entries to recognize provision : In May 2017, Smile Company became involved in litigation. In December 2017, the court assessed a judgement for 800,000 against Smile. The entity is appealing.

How compute price of bonds based on semiannual analysis : Compute the price of the bonds based on semiannual analysis. Heme W Black lard age EMail in linkedln Indeed Thrift Savings Plan Gangle '- Other rewrites Exam 3.

What are the concepts of ethical threats to independence : What are the concepts of ethical threats to independence which might have impaired their objectivity, resulting in the audit failure?

Record the derecognition of the detoxification facility : On January 1, year 1, Camella Company purchased a gas detoxification facility for 5,850,000. The cost of cleaning up the routine contamination caesed by the.

Demonstrate oral communication skills : Demonstrate your oral communication skills by explaining financial decisions and outcomes clearly and using listening and questioning techniques

What is the holding period? return : The bond matures in one? year, and at that time you will collect the par value and the interest payment. If you can purchase this bond for ?$9,047?

Role of global financial centers in global financial system : What is the role of global financial centers in global financial system and how global financial centers can help in economic growth of developing countries?

User Account

All Pages