A CPA Firm Is Comprised of 100 Audit Partners

question 35

Multiple Choice

A CPA firm is comprised of 100 audit partners.Three of these partners own stock in one of the CPA firm's audit clients,with each such partner owning 2% of the outstanding shares in this client.Does this CPA firm retain the independence to audit this client?

• A) Yes, as long as none participate in the audit as the primary or concurring partner
• B) Yes, as long as none render non-audit services to this client
• C) Yes, as long as none is a "covered member' with respect to this client
• D) No

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Definitions:

Social Learning Theory

The view championed by Bandura that human social behaviour is not innate but learnt from appropriate models.

Vicarious Experience

Learning or feeling an emotional response through the experiences of another person, rather than through direct personal experience.

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The act of removing water from washed dishes, typically using a towel or allowing them to air dry, to make them ready for use.

Direct Reinforcer

An immediate reward given to reinforce a desired behavior.