MIPPS and Conceptual Framework

Question 1

What is public practice?

Answer 1

performance of professional services for a client by a member or the member’s firm

Question 2

What is the Threats and Safeguards conceptual framework?

Answer 2

A method to determine whether threat’s to a members compliance with the rules can be reduced to an acceptable level by application of safeguards when the codes rules / interpretations do not provide a clear answer

Question 3

What is an acceptable level

Answer 3

A level at which a reasonable and infromed third party who is aware of the relevant informaiton would be expected to conclude that a member’s compliance with the rules is not compromised

Question 4

Steps to applying conceptual framework

Answer 4

Identify threats
Evaluate significance of the threats
Identify and apply safeguards

Question 5

What are the seven catagories of threats?

Answer 5

Adverse Interest Threats
Advocacy threats
Familiarity threats
Management participation threats
Self-interest threats
Self-review threats
Undue influence threats

Question 6

What safeguards exist?

Answer 6

Safeguards created by the profession, legislation, or regulation
Safeguards implemented by the client
Safeguards implemented by the firm