A Succinct,but Comprehensive Definition of Independence Is That an Auditor

question 42

Multiple Choice

A succinct,but comprehensive definition of independence is that an auditor ________.

• A)must be independent in fact and in appearance in order to maintain credibility
• B)must not have a direct financial interest or material indirect interest in a client
• C)must have a license to practice as a public accountant
• D)must not take on as an audit client a company owned by a member of his or her immediate family

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Definitions:

Job Evaluation System

A systematic process for determining the relative worth or value of a job in an organization to establish fair compensation levels.

Point Method

A technique used in job evaluation that involves assigning point values to job elements to assess their relative worth.

Job Evaluation System

A method used to determine the value and pay grade of positions within an organization based on their responsibilities and qualifications.

Pay Range

The span of possible pay rates set by employers that determine the minimum and maximum amount that can be offered to an employee for a specific job.