When an Accountant Is Not Independent of an Entity and Is

question 91

Multiple Choice

When an accountant is not independent of an entity and is requested to perform a compilation of the entity's financial statements, the accountant

• A) Is precluded from accepting the engagement.
• B) May accept the engagement and need not disclose the lack of independence.
• C) May accept the engagement and should disclose the lack of independence, but need not indicate the reason for the lack of independence.
• D) May accept the engagement and should disclose both the lack of independence and the reason for the lack of independence.

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Definitions:

Psychological Disorders

Psychological disorders are mental health conditions characterized by alterations in thinking, mood, or behavior associated with distress or impaired functioning.

Cognitive Psychologist

A branch of psychology that studies mental processes such as "attention, language use, memory, perception, problem solving, creativity, and thinking."

Heuristics

Cognitive shortcuts or rules of thumb that simplify decision making, allowing for quick judgments and problem-solving despite the absence of complete information.

Visual Imagery

The process of visualization where an individual imagines visuals in their mind, often used in memory and creative processes.