Under what condition do non-audit services not require self-review safeguards?

The situation where non-audit services do not require self-review safeguards is when informed management is involved and appropriate disclosures are made. This condition is grounded in the principle of ensuring that management is aware of the implications of the non-audit services provided to the audit client. When management is informed, they have the necessary understanding to evaluate the potential impacts of any non-audit services on the financial statements and overall audit process.

Informed management can take appropriate decisions and implement necessary oversight, thus minimizing the risk of bias or conflict of interest that self-review safeguards are meant to address. By making disclosures, the auditor allows management to be fully aware of the nature of the services rendered, which helps maintain transparency and supports effective governance.

The other options, while they may address certain aspects of the auditor-client relationship, do not provide the same level of assurance or control over potential self-review threats that arise from non-audit services. For instance, merely having a client relationship that exceeds two years doesn’t inherently ensure that there is a safeguarding mechanism against self-review threats, as familiarity over time could introduce bias. Similarly, a fee structure or maintaining the integrity of the audit team does not substitute the importance of informed management and the transparency that comes from disclosures in preventing self-review threats