Malaysian Institute of Accountants
(Established under the Accountants Act 1967)
Institut Akauntan Malaysia
(Diperbadankan di bawahAktaAkauntan 1967)
QUALIFYING EXAMINATION
Paper: Auditing and Assurance Services
Auditing and Assurance Services
Date : 13 September 2018
Time : 9.30 am – 12.45 pm
Reading and Planning : 15 minutes
Writing : 3 hours
INSTRUCTIONS TO CANDIDATES:
This question paper contains 6 questions on 6 printed pages.
Answer ALL questions.
Answer Questions 1, 2 and 3 in separate booklet(s) from
Questions 4, 5 and 6.
Do not open this paper until instructed by the invigilator.
During reading and planning time only the question paper
may be annotated. You must NOT write in your answer
booklet until instructed by the invigilator.
UNIVERSITI TEKNOLOGI MARA
Examination Body
CONFIDENTIAL
2
QUESTION 1
A. The auditors should be independent from the client in order to ensure the credibility
of the audit opinion.
Required:
a. Explain the terms ‘independence of mind’ and ‘independence in appearance’.
(4 marks)
b. Explain three (3) types of threats to independence faced by the auditors.
(6 marks)
B. The traditional view is that the auditor owes his primary and legal duty to the
shareholders of a company. However, over the past decades the public perceived
that the auditor also owes his duties to other parties outside the auditor-client
relationship.
Required:
a. Discuss three (3) conditions that should be met in order to establish the
auditor’s duty of care. (6 marks)