A CPA Who Is Not Independent and Is Associated with Financial

question 27

Multiple Choice

A CPA who is not independent and is associated with financial statements should disclaim an opinion with respect to those financial statements. The disclaimer should

• A) Clearly state the specific reasons for lack of independence.
• B) Not mention any reason for the disclaimer other than that the CPA was unable to conduct the examination in accordance with generally accepted auditing standards.
• C) Not describe the reason for lack of independence but should state specifically that the CPA is not independent.
• D) Include a middle paragraph clearly describing the CPA's association with the entity and explaining why the CPA was unable to gather sufficient appropriate evidential matter to warrant the expression of an opinion.

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Definitions:

Rate of Return

The profit or deficit made on an investment within a certain timeframe, shown as a percentage of the original investment's value.

Market Expected Rate

The return investors anticipate receiving from an investment, based on market conditions and asset performance.

Risk-Free Rate

The theoretical rate of return of an investment with zero risk of financial loss, often represented by the yield on government bonds.