Independence Issues That Would Preclude an Audit Firm from Proposing

question 46

Multiple Choice

Independence issues that would preclude an audit firm from proposing on a potential audit client:

• A) are only applicable on public company audit engagements.
• B) are not affected by the Sarbanes-Oxley Act.
• C) cannot be determined until the audit planning process is complete.
• D) may result from current business relationships of the audit firm's former employees.

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Definitions:

Seminiferous Tubule

Long, coiled structure contained within chambers of the testis, where sperm are produced.

Fimbriae

Short, hair-like structures on the surface of some bacteria that help in attachment to surfaces or other cells.

Female Reproductive System

The system in females that produces eggs and facilitates fertilization, gestation, and childbirth; includes organs such as ovaries, fallopian tubes, uterus, and vagina.

Prostate

A gland in the male reproductive system that surrounds the urethra near the bladder, contributing fluid to semen.