CA Kamal, a partner at KPS & Co., is conducting an audit of Ridhi Ltd., a manufacturing company. During the audit it was found that KPS &…
CA Intermediate · Auditing and Ethics · MTP · January 2025
CA Kamal, a partner at KPS & Co., is conducting an audit of Ridhi Ltd., a manufacturing company. During the audit it was found that KPS & Co. generates 72% of its total revenue from Ridhi Ltd., raising concerns about the firm's financial dependence on this single client. Identify the kind of threat to independence that may be involved in this case.
Suggested Answer and Working Notes:
Correct Answer: Option (B)
Self-interest threat
Topics: Ethics and Terms of Audit Engagements
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