Section 910: Financial Interests

Section 910: Financial Interests · Complied AI

(b)

If the interest is received by an assurance team member, or by any of that individual’s immediate family, the individual who received the financial interest shall immediately dispose of the financial interest, or dispose of enough of an indirect financial interest so that the remaining interest is no longer material.

Financial Interests – Other Circumstances

Close Family

910.8 A1 A self-interest threat might be created if an assurance team member knows that a close family member has a direct financial interest or a material indirect financial interest in the assurance client. 910.8 A2 Factors that are relevant in evaluating the level of such a threat include: • The nature of the relationship between the assurance team member and the close family member. • Whether the financial interest is direct or indirect. • The materiality of the financial interest to the close family member. 910.8 A3 Examples of actions that might eliminate such a self-interest threat include: • Having the close family member dispose, as soon as practicable, of all of the financial interest or dispose of enough of an indirect financial interest so that the remaining interest is no longer material. • Removing the individual from the assurance team. 910.8 A4 An example of an action that might be a safeguard to address such a self-interest threat is having an appropriate reviewer review the work of the assurance team member.

Other Individuals

910.8 A5 A self-interest threat might be created if an assurance team member knows that a financial interest is held in the assurance client by individuals such as: • Partners and professional employees of the firm, apart from those who are specifically not permitted to hold such financial interests by paragraph R910.4, or their immediate family members. • Individuals with a close personal relationship with an assurance team member. 910.8 A6 An example of an action that might eliminate such a self- interest threat is removing the assurance team member with the personal relationship from the assurance team. 910.8 A7 Examples of actions that might be safeguards to address such a self-interest threat include: • Excluding the assurance team member from any significant decision-making concerning the assurance engagement. • Having an appropriate reviewer review the work of the assurance team member.