Which of the Following Would Be Least Likely to Preclude

question 34

Multiple Choice

Which of the following would be least likely to preclude an audit firm from proposing on a potential client due to independence concerns?

• A) A recently-promoted partner in the audit firm holds a financial interest in the potential client company.
• B) Someone who resigned from the audit firm three years ago is now the Chief Accounting Officer at the potential client company.
• C) The audit firm provides internal audit outsourcing and certain nonaudit services to the client company.
• D) The audit firm's pension plan holds securities of the potential client company.

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Definitions:

Research Hypothesis

A statement made for a study based on predictions of a possible outcome, which can be tested through research or experimentation.

Correlation Coefficient

An index that quantifies the magnitude and direction of a straight-line association between a pair of variables.

Estimate Reliability

A measure or assessment of the stability or consistency of an estimate from one context or test administration to another.

Interest Rate

The financial charge on a borrower by a lender for asset usage, presented as a percentage of the principal figure.