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:

IFRS

International Financial Reporting Standards, which are a set of accounting standards developed by the International Accounting Standards Board (IASB) used globally to prepare public company financial statements.

Statement of Changes in Equity

A financial report that outlines the movements in equity of a company over a specific period, including profits or losses, dividends issued, and any changes in share capital.

Common Shares

Equity securities that represent ownership in a company, entitling the holder to vote at shareholders' meetings and to share in the company's profits through dividends.

Dividends Declared

Refers to the announcement by a company's board of directors of the payment of a dividend to shareholders, specifying the size and date of the payment.