The correct answers are: 2.5% of the income of a firm of auditors comes from fees from one group of clients; A company auditor finalises the statutory accounts of a small, unlisted audit client; The finance director of a company gives a box of chocolates to the company auditor on her birthday.

It is likely that where only 2.5% of the income of a firm of auditors comes from fees from one group of clients, the situation will be acceptable. The limit set by the Code in respect of public interest entities before special safeguards are compulsory is 15% of total fees for two years, and 2.5% is well below that. Where a company auditor finalises the statutory accounts of a small, unlisted audit client, or where the finance director of a company gives a box of chocolates to the company auditor on her birthday, the situation is likely to be acceptable. The preparation of the accounts for a public interest company, or the acceptance of a large gift will present a threat to independence.

The ACCA's Code of Ethics and Conduct makes it clear that significant loans between auditor and client, or a close personal relationship between auditor and client are a threat to independence and are unacceptable.