Which of the following principles of The IIA's Code of Ethics implies that internal auditors should refrain from performing assurance services when there is an impairment to audit independence that…

Question

Options

• AConfidentiality.
• BObjectivity.
• CIntegrity.
• DCompetency.

• A
  3% (1)
• B
  71% (27)
• C
  18% (7)
• D
  8% (3)

Explanation

Objectivity is correct because The IIA's Code of Ethics defines objectivity as an unbiased mental attitude requiring internal auditors to avoid conflicts of interest and not subordinate their judgment to others. Crucially, it obligates auditors to disclose any impairments to independence or objectivity - and if disclosure isn't made, performing the assurance engagement would directly violate this principle.

• Confidentiality (A) is wrong because it governs how auditors handle sensitive information they acquire during engagements, not whether they should accept or decline engagements.
• Integrity (C) is wrong because integrity relates to honesty and avoiding illegal acts or deception - it's broader ethical behavior, not the specific obligation to declare independence impairments.
• Competency (D) is wrong because competency concerns having the knowledge and skills to perform audit work, which is unrelated to independence conflicts.

Memory tip: Think "Objectivity = eyes on the target, no bias allowed." If something clouds your vision (impairs independence) and you don't tell anyone, you've violated objectivity. The word objectivity itself contains the idea of being an unobstructed observer - any hidden impairment destroys that.

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