AAT Diagnostics

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Question 16

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Ankit is a licensed member. He has concluded that, due to suspicions of dishonesty, he cannot sufficiently reduce the threats to his compliance with the fundamental principles represented by a potential new client, Bhatt Industries. What should Ankit do?

	Communicate with the current accountant for Bhatt Industries
	Decline to enter into a client relationship with Bhatt Industries
	Issue a suitably worded letter of engagement to Bhatt Industries
	Make a report the anti-money laundering authority

Explanation of the correct answer:

In this circumstance all Ankit has to do is to decline to enter into the relationship: s210.5. No wording for a letter of engagement can cover the problem of threats that cannot be sufficiently reduced. He is under no duty to report to the anti-money laundering authority and he has no need to communicate with the current accountant.

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Question 16

Select the correct answer.
 

Ankit is a licensed member. He has concluded that, due to suspicions of dishonesty, he cannot sufficiently reduce the threats to his compliance with the fundamental principles represented by a potential new client, Bhatt Industries. What should Ankit do?

	Communicate with the current accountant for Bhatt Industries
	Decline to enter into a client relationship with Bhatt Industries
	Issue a suitably worded letter of engagement to Bhatt Industries
	Make a report the anti-money laundering authority

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