AU-C Section 220.11-13: Relevant Ethical Requirements

AU-C Section 220.11-13 says:

".11 Throughout the audit engagement, the engagement partner and other members of the engagement team should remain alert for evidence of noncompliance with relevant ethical requirements by members of the engagement team. (Ref: par. .A4)

.12 If matters come to the engagement partner's attention, through the firm's system of quality control or otherwise, that indicate that members of the engagement team have not complied with relevant ethical requirements, the engagement partner, in consultation with others in the firm as appropriate,
should determine that appropriate action has been taken. 

Independence
 
.13 The engagement partner should form a conclusion on compliance with independence requirements that apply to the audit engagement. In doing so, the engagement partner should

•  obtain relevant information from the firm and, when applicable, network firms to identify and evaluate circumstances and relationships that create threats to independence;
•  evaluate information on identified breaches, if any, of the firm's independence policies and procedures to determine whether they create a threat to independence for the audit engagement; and
• take appropriate action to eliminate such threats or reduce them to an acceptable level by applying safeguards or, if considered appropriate, to withdraw from the audit engagement when withdrawal is possible under applicable law or regulation.The engagement partner should promptly report to the firm any inability to resolve the matter so that the firm may take appropriate action. (Ref: par. .A5–.A6)"

The engagement partner should constantly be on alert that the firm's ethical requirements are being met.  This includes the engagement team's duty to

• Fulfill its responsibilities
• act in the public interest
• act with integrity
• be objective and independent;
• and act with due care

A more detailed discussion of relevant ethics requirements were included in AU-C Section 200.16.  If a member of the engagement team has not complied with a relevant ethical requirement, the engagement partner should take appropriate action.

The engagement partner should also determine whether the engagement is in compliance with independence rules by doing the following:

• obtain information from the firm in order to identify relationships and threats to independence
• identify any breaches to independence policies, if any, that would impair the independence of the engagement
• take actions to eliminate threats to independence or reduce them to an acceptable level

A more detailed discussion of independence requirements were included in AU-C Section 200.15.

https://www.aicpa.org/content/dam/aicpa/research/standards/auditattest/downloadabledocuments/au-c-00220.pdf