A CPA Firm Billed for Audit Services Performed for a Client

question 12

Multiple Choice

A CPA firm billed for audit services performed for a client more than one year ago.The client has paid a portion of the fees outstanding,but it has not been able to pay the remaining balance due to cash flow problems.The CPA firm has verified that the cash flow problems are authentic and expects the client to be able to pay the remainder of the bill,but the CPA firm cannot reasonably estimate the timing of such payments.As a result,the CPA firm:

• A) Remains independent if the amounts that remain owing are immaterial to the CPA firm
• B) Remains independent if the client has paid over 50% of the total invoice outstanding
• C) Can preserve its independence if the client willingly signs a Note Payable for these services and the note bears a reasonable market rate of interest
• D) Lacks the independence to perform further attestation services

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Definitions:

Social Composition

The structure and demographic makeup of a society or social group, including aspects like age, gender, income level, and ethnicity.

Fertility Rates

The average number of children born to a woman over her lifetime within a specific population.

Kerala

A state in the southern part of India, known for its significant achievements in health, education, and social welfare.

Industrialized

Referring to countries, economies, or societies that have developed complex industries in wide-ranging sectors and demonstrate significant technological advancement.