An auditor performing nonaudit work for a client may be in danger of violating the independence rules in Government Auditing Standards when he or she
A) Conducts a search and recommends a particular person for a management position for the client.
B) Provides advice on establishing or improving internal controls.
C) Provides the client with benchmarking information.
D) Answers technical questions for the client.

Question

Quizplus · Accepted Answer

Recommending a person for a management position for the client can compromise the auditor's independence and objectivity, as it can create a conflict of interest and may impair the auditor's ability to remain unbiased in conducting audits or reviews of the client's financial statements.

Answer: B, C, and D
 Providing advice on establishing or improving internal controls, providing the client with benchmarking information, or answering technical questions for the client may not inherently impair the auditor's independence, as long as the nonaudit work is performed within the scope of the auditor's expertise and does not involve making management decisions. However, the auditor should still consider the potential threats to independence and take appropriate safeguards to mitigate them.

An Auditor Performing Nonaudit Work for a Client May Be