An audit firm is asked to design and implement a new, highly complex IT accounting system for an audit client, and then audit the financial statements generated by that exact same system at year-end. What major threat does this create?

Correct answer: A) Self-review threat

Explanation

A self-review threat arises when an auditor is required to evaluate the results of a previous judgment made or service performed by themselves or their firm. Auditing a system the firm itself built makes it highly unlikely they will objectively report its flaws.