A "Covered Member" of a CPA Firm Owns 4% of the Bonds

question 30

Multiple Choice

A "covered member" of a CPA firm owns 4% of the bonds outstanding in an audit client.In accordance with the Independence Rule,does this CPA firm have the independence to audit this client?

• A) Yes, as long as the CPA's immediately family does not have any additional financial interests in this client
• B) Yes, as long as the bonds are not convertible into common stock
• C) No, unless the CPA agrees to not directly participate in the audit
• D) No, because of the self-interest threat