Which of the following principles of The IIA's Code of Ethics implies that internal auditors should refrain from performing assurance services when…

Question breakdown

Tests

Map Code of Ethics principles to behaviors

Difficulty

Easy

Key idea: Objectivity requires internal auditors to avoid activities and relationships that impair, or appear to impair, unbiased assessment, and to disclose material facts that could affect it.

How to reach the answer

1. Spot the key phrase in the question: an independence impairment that has not been declared.
2. Recall that the Code's Objectivity rules cover activities or relationships that may impair unbiased assessment.
3. Confidentiality concerns protecting information, and Competency concerns knowledge and skills, so neither fits.
4. Integrity is broad, but impairments are addressed specifically under Objectivity.

Each option

• AIncorrect. Confidentiality is about the proper use and protection of information, not impairments.
• BCorrect. Objectivity's rules of conduct directly cover avoiding and disclosing conflicts that impair unbiased assessment.
• CIncorrect. Integrity covers honesty and lawful conduct generally, not the specific handling of impairments.
• DIncorrect. Competency covers having the needed skills and following the Standards, not independence conflicts.

Common trap: Integrity seems to fit any ethical lapse, but the Code assigns impairment issues specifically to Objectivity.

In practice: Auditors complete annual conflict-of-interest declarations and decline or disclose assignments where a relationship could bias their judgment.

Remember: Impairments, conflicts and undisclosed bias fall under the Objectivity principle.

Drafted with AI assistance and checked against the answer key.