The Australian Securities & Investments Commission 2020 Audit Inspection report indicated that Professional Scepticism is not always applied well by auditors or communicated to directors. Which of the following factors influence the level of Professional Scepticism shown by auditors:Group of answer choicesLevels of education, training and experience, and therefore overall competence.The audit client's new supply chain management system.The culture, incentives and business environment of the audit firm.Personal attitudes and ethical values.
Question
The Australian Securities & Investments Commission 2020 Audit Inspection report indicated that Professional Scepticism is not always applied well by auditors or communicated to directors. Which of the following factors influence the level of Professional Scepticism shown by auditors:Group of answer choicesLevels of education, training and experience, and therefore overall competence.The audit client's new supply chain management system.The culture, incentives and business environment of the audit firm.Personal attitudes and ethical values.
Solution
Professional skepticism is an essential part of the auditor's mindset and is influenced by various factors. Here are how the given options relate to it:
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Levels of education, training and experience, and therefore overall competence: This is a factor that influences the level of professional skepticism shown by auditors. More experienced auditors with higher levels of education and training are likely to have developed a greater level of professional skepticism.
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The audit client's new supply chain management system: This is not a direct factor influencing the level of professional skepticism shown by auditors. However, a new system might require auditors to exercise more skepticism due to unfamiliarity or potential risks associated with the new system.
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The culture, incentives and business environment of the audit firm: This is a factor that influences the level of professional skepticism shown by auditors. A firm culture that encourages questioning, critical assessment, and rewards skepticism can enhance the application of professional skepticism.
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Personal attitudes and ethical values: This is a factor that influences the
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