The SEC's Rules with Respect to Services Provided by Auditors

question 21

Essay

The SEC's rules with respect to services provided by auditors are predicated on three basic principles of auditor objectivity and independence. What are the three basic principles?

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Definitions:

Currency Swap

A financial agreement to exchange principal and interest in one currency for the same in another currency.

Derivative Instrument

A financial security whose value is derived from an underlying asset, index, or interest rate, often used for hedging or speculative purposes.

Futures Contract

A legal agreement to buy or sell a particular commodity or financial instrument at a predetermined price at a specified time in the future.

Call Option

A financial contract giving the option buyer the right, but not the obligation, to buy a specified amount of an underlying asset at a set price within a specified time.