Which of the Following Statements Is True? the CPA Firm

question 30

Multiple Choice

Which of the following statements is true? The CPA firm will lose its independence if:

• A)a staff auditor providing audit services to the client acquires stock in that client.
• B)a staff tax preparer who provides 15 hours of non-audit services to the client acquires stock in that client.
• C)an audit manager in an office different than the office providing audit services has a direct, immaterial financial interest in the audit client.
• D)a covered member has an indirect, immaterial financial interest in an audit client.

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Definitions:

Economic Sociology

A subfield of sociology that focuses on the social cause and effect of various economic phenomena.

Breakdown Theory

A theory suggesting that social movements arise when traditional social bonds and structures weaken, leading individuals to seek new forms of collective identity.

Economically Deprived

Refers to individuals or communities that lack adequate financial resources and access to basic necessities, leading to a lower standard of living.

Socially Rootless

Describes individuals or groups lacking a sense of belonging or connection to a specific community, culture, or social identity, often leading to feelings of isolation.