Which of the Following Statements Is FALSE When a Public

question 1

Multiple Choice

Which of the following statements is FALSE when a public accountant (PA) has an investment in a non-client investor?

• A) This investment may be a direct or material indirect financial interest that will diminish independence with respect to a client investee.
• B) Independence is not impaired, as long as the PA does not have significant influence over the actions or financial statements of the non-client investor.
• C) Independence is impaired when the PA's investment gives him or her significant influence over the actions of the non-client investor, which might in turn influence the client investee.
• D) The independence of the PA is always impaired when a PA has an investment in a non-client investor because it puts him or her in a position similar to that of a member of management of the client investee.

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Definitions:

Amino Acids

The building blocks of proteins, consisting of a central carbon atom bonded to an amino group, a carboxyl group, a hydrogen atom, and a variable side chain.

Proteins

Massive biological molecules, known as macromolecules, are composed of one or more extended sequences of amino acid residues and fulfill a wide range of roles in organisms.

Peptide Bonds

Chemical bonds formed between amino acids during the formation of proteins.

Amino Acids

Organic compounds containing an amino group and a carboxylic acid group, serving as the building blocks of proteins, involved in various biological processes.