Intimidation Threat in Auditing

Intimidation threat occurs when a member of the engagement team may be deterred from acting objectively and exercising professional skepticism by threats, actual or perceived, from the directors, or employee of an assurance client.

Here are some examples of of circumstances that may create intimidation threat but are not limited to:

  • Being threatened with litigation.
  • Being threatened with dismissal or replacement over a disagreement with the application of an accounting principle.
  • Being pressured to reduce inappropriately the extent of work performed in order to reduce fees.
So, we have already discussed the threats to compliance with fundamental principles in auditing. Next, I am going to share with you the safeguards to minimize the threat or completely eliminate the threat to deliver the appropriate opinion in conducting the audit. 

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