The Material Financial Interests Rule Means That

question 70

Multiple Choice

The material financial interests rule means that:

• A) an auditor cannot accept payment from the auditee.
• B) an auditor should be involved in the executive function of a client to maximise the benefits achieved from the engagement.
• C) a public accounting firm cannot accept an audit client if anyone in the practice has a material shareholding in the potential client.
• D) an auditor cannot be assigned to the audit of a bank with which that auditor has a home mortgage.

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Definitions:

Creativity

The ability to generate novel and valuable ideas or solutions.

Introverts

People whose energy tends to increase from being alone and decreases from being around others, typically preferring solitary activities.

Neurotic People

Individuals who are more likely to experience negative emotions such as anxiety, worry, fear, anger, frustration, envy, jealousy, guilt, depressed mood, and loneliness.

Hans Eysenck

A notable psychologist who developed a influential hierarchical model of personality structured around three broad traits: Extraversion, Neuroticism, and Psychoticism.