Why is it important to establish informed management when providing non-audit services?

Establishing informed management is critical when providing non-audit services because it ensures independence and objectivity in the audit process. When management is informed, it means they are fully aware of the implications and potential risks of the services being provided. This awareness helps to maintain a clear boundary between the roles of the auditor and management, which is essential for preserving the integrity of the audit.

Independence is vital for auditors as it underpins the credibility of the audit opinion. If auditors are involved in providing non-audit services without proper management oversight, they may inadvertently compromise their objectivity. Clear communication and understanding among management regarding the scope and nature of these services help to avoid conflicts of interest and potential biases that could affect the auditor's judgment.

In contrast, while soliciting client feedback can be beneficial for service improvement, justifying fees charged is more about the financial aspect rather than the governance and ethical framework of the audit process. Likewise, while creating a competitive advantage may be a secondary benefit, it doesn't address the core requirement of maintaining independence and objectivity in the audit function. Thus, ensuring informed management directly supports the foundational principles of the auditing profession, which is why this approach is paramount when non-audit services are provided.