A line there states that, Regarding independence, Wiles mentioned that her

daughter is a staff accountant for Harer and Jones

A professional accountant has an obligation to evaluate threats to compliance to
fundamental principles. He is expected to know the circumstances that may
compromise compliance with the fundamental principles.
Independence is an important factor that must be considered by the firm before
accepting an audit engagement. Independence of mind and in appearance is
necessary to enable the professional accountant in public practice to express a
conclusion and be seen to express a conclusion without bias, conflict of interest or
undue influence of others. They should consider whether there are any threats to
the audit teams independence.
Once the threat has been identified a professional accountant may be required to
resolve the a conflict inin the application of Fundamental standards. We say
depending on the circumstances because as what Ive read we dont just comply
with a set of specific rules because there can be different circumstances or
combination of circumstances so it is impossible to define every situation and
specify the appropriate action that should be taken.
that is why the Code of Ethics provides a framework to assist professional
accountant to identify, evaluate, and address threats to compliance with the
fundamental standards taking into consideration as part of the resolution process:

Relevant facts
Ethical issues involved
Fundamental principles related
Alternative courses of action

PROBLEM:
Jones.

Donna Wiles daughter is working as a staff accountant in Harer and

RELEVANT FACTS:
Donna Wiles is working as a controller of Lone Star
A company's controller is the chief accounting officer and heads the
accounting department. The controller is responsible for the company's
financial statements, general ledger, cost accounting, payroll, accounts
payable, accounts receivable, budgeting, tax compliance, and various special
analyses
Her daughter is working as a staff accountant in Harer and Jones.
The controller has no ownership interest in Lone Star at the present time
It can be said that Wiles is an employee of the client who is in position to exert
significant influence over the subject matter of the engagement. And she is an
immediate family of the staff accountant.with that having said the

FUNDAMENTAL PRINCIPLE RELATED:

Objectivity and there isfamiliarity threat to objectivity.
ACTIONS TAKEN :

Discuss the issue with higher levels of management within the firm
As it is stated, at your meeting with the managing partner of the office, you
are able to resolve potential independence proble
Prohibitions of assigning to an audit client firm professionals whose family
members are employed in certain positions at the client.

the staff accountant may not be ssigned in the engagement with Lone Star.
As it was said earlier it we shouldnt just have independence in mind but also in
appearance that is why it is best for the proff. Accountant to document the
details of any discussions held or decisions taken concerning th`e issue.
Self-interest. The threat that arises when an auditor acts in his or her own
emotional, financial or other personal self-interest.
Self-review. The threat of bias arising when an auditor audits his or her own
work or the work of a colleague.
Advocacy. The threat that arises when an auditor acts as an advocate for or
against an audit clients position or opinion rather than as an unbiased attestor.
Familiarity (or trust). The threat that arises when an auditor is being influenced
by a close relationship with an audit client.
Intimidation. The threat that arises when an auditor is being, or believes that he
or she is being, overtly or covertly coerced by an audit client or by another
interested party.