In Which of the Following Instances Would the Independence of the Auditor

question 34

Multiple Choice

In which of the following instances would the independence of the auditor most likely not be considered to be impaired?

• A) He or she has been retained as the auditor of a charitable organisation in which the spouse of the auditor serves as treasurer.
• B) He or she has been retained as the auditor of a company in which the auditor's investment club owns a 10 per cent interest.
• C) He or she has been retained as the auditor of a large manufacturing company to which the auditor has a $6000 loan.
• D) He or she has been retained as the auditor of a company from which the auditor purchased their latest motor vehicle at normal list price.

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Definitions:

Wheat Futures

Contracts that specify the future delivery of a certain amount of wheat at a predetermined price.

Price Increase

An upward movement in the price of a good, service, or asset, often due to factors like demand growth or supply constraints.

Long Position

Holding an asset with the expectation that it will increase in value, often contrasted with taking a short position, betting on a decline in value.

Futures Contracts

Futures contracts are standardized legal agreements to buy or sell a particular commodity or financial instrument at a predetermined price at a specified time in the future.