Which of the Following Family Relationships Is Most Likely to Impair

question 72

Multiple Choice

Which of the following family relationships is most likely to impair a CPA's independence with respect to a particular audit client on which the CPA works as a "covered member"?

• A)A close relative has a material investment in that client of which the CPA is not aware.
• B)A cousin has an immaterial investment in the client of which the CPA is aware.
• C)The CPA's sister is controller of the audit client.
• D)The CPA's spouse participates in a savings plan sponsored by the client.

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Definitions:

Centralized Power

A form of governance in which all major decisions and authority are concentrated in a central government or authority figure.

Direct Democracy

A form of democracy in which people directly decide on policy initiatives without intermediary representatives or officials.

Fort Sumter

A federal fort in Charleston Harbor, South Carolina, notable for the first shots of the American Civil War being fired there in 1861.

Charleston Harbor

a notable body of water located in South Carolina, known historically for its strategic importance during both the American Revolution and the Civil War.