Under the AICPA Independence Rules, Independence Can Be Considered Impaired

question 53

Multiple Choice

Under the AICPA independence rules, independence can be considered impaired when

• A) billed fees remain unpaid for professional services for more than ninety days.
• B) a client in bankruptcy has unpaid fees for more than one year.
• C) there is litigation by the client related to the auditor's tax or other nonaudit services for an immaterial amount.
• D) there is a lawsuit by the client claiming deficiencies in the previous year's audit.

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Definitions:

Inexpensive

Costing little money; affordable or budget-friendly.

Culturally Appropriate

Actions, behaviors, or practices that are considerate and respectful of the cultural norms and values of others.

APA Ethics Code

A set of guidelines and standards established by the American Psychological Association to ensure ethical practice in the field of psychology.

Risk of Exploitation

The possibility of taking unfair advantage of someone, especially in situations involving power imbalances.