1. What are the dangers of accepting contingent fees from audit clients for performing non-audit services? Assume in such situations the auditor can, in fact, make independent audit decisions regardless of the contingent fee arrangements. Would independence be impaired in such situations?
2. How did Avon accounting for the project costs on the abandoned order-management software project violate GAAP? How did PwC role in the capitalized costs for consulting services violate its ethical obligations?