What are common independence threats to auditors, and how can they be mitigated?

• A. Only self-interest is an independence threat; mitigation is to increase audit frequency.
• B. Threats include self-review, self-interest, familiarity, intimidation, advocacy; mitigations include rotation, partner oversight, prohibit certain non-audit services, robust independence policies.
• C. Independence threats are not applicable to internal auditors.
• D. Mitigations involve increasing audit fees.

Answer: (B)

Maintaining independence means the auditor’s judgment stays objective and free from Influence that could bias the audit. There are several common threats to independence: self-interest (financial or other benefits from the client), self-review (having to evaluate work you previously did), familiarity (a long-standing relationship that dulls professional skepticism), intimidation (threats or pressure from the client), and advocacy (advancing the client’s position rather than staying neutral). The best answer pairs these threats with practical ways to counter them: rotating audit staff or partners helps prevent over-familiarity and reduce biased thinking; having a second partner review significant judgments adds independent challenge and oversight; prohibiting certain non-audit services reduces conflicts of interest and the risk of self-review; and implementing robust independence policies—clear rules, disclosures, training, and ongoing monitoring—keeps expectations explicit and monitored.

This combination reflects how professional standards approach independence: identify the threats, and put systemic controls in place to mitigate them. The other options fall short because they minimize the range of threats, deny applicability to internal auditors, or suggest ineffective or irrelevant remedies (like increasing audit fees) that don’t address independence risks.