Audit Committees Should Consider All Factors That Might Affect the Independence

question 21

Multiple Choice

Audit committees should consider all factors that might affect the independence of which of the following:

• A)chief executive officer
• B)chief financial officer
• C)external auditors
• D)all of the above.

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Definitions:

Irrational

Behavior or actions that are not based on sound judgment or logic, often contrary to self-interest.

Financial Crisis

A situation where financial assets suddenly lose a significant part of their nominal value, often leading to bankruptcies and economic downturns.

Behavioral Economics

A field of economics that studies how psychological, cognitive, emotional, cultural, and social factors affect economic decision-making and behaviors.

Financial Gain

An increase in financial wealth, often resulting from investments or the operations of a business.