The Potential Conflict of Interest When a Single Accounting Firm

question 89

Multiple Choice

The potential conflict of interest when a single accounting firm provides both auditing and consulting services is that the firm can

• A) charge higher fees to its audit clients and lower fees for its consulting services so it can expand its consulting business.
• B) charge higher fees to its consulting clients and lower fees for its audit services so it can expand its auditing business.
• C) provide unjustifiably favorable audit reviews for firms that are large clients for its consulting services.
• D) pressure its clients into paying high fees for both auditing and consulting services.

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