A CPA in charge of the external audit of a nonissuer received an unexpected inheritance that includes 100 shares of the audit client's common stock. Which of the following actions should the CPA take to avoid violation independence rules? a. Resign from the audit from b. Dedine to accept the inheritance c. Petition the NCPA for an independence exemption from unfogeseen circumstances d. Sell or donate the stock within 30 dogs after receipt of ownership rights
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Which of the following actions should the CPA take to avoid violation independence rules? a. Resign from the audit firm b. Decline to accept the inheritance c. Petition the AICPA for an independence exemption from unforeseen circumstances d. Sell or donate the Show more…
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Text: Martina (a tax manager) has been assigned to the audit of Tandem Electric, Inc. Martina is concerned that Joseph, a close family friend for many years, is the CFO of Tandem Electric. Concerned about the appearance of her independence, she applies the AICPA conceptual framework and determines that the threat to her independence is significant and cannot be mitigated by safeguards. As a result, what is Martina's best course of action? a) She should document her assessment of independence, which should include a sworn statement from Joseph. b) She should participate in the audit engagement because her firm wants her to. c) She should not provide audit services to Tandem Electric. d) She should not participate in the audit unless she obtains a written waiver from her firm's general counsel.
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Sergio identifies a conflict of interest in connection with his tax client, Company C. What is he required to do under Circular No. 230? a) Email copies of written consents to the SEC's Office of the Chief Accountant. b) Email copies of written consents to all interested parties. c) Obtain written statements from the affected parties that they will not sue him. d) Obtain written, informed consent to perform the service from each affected client.
You have become the executor of your brother's will and you inherited several investments in non-restricted entities. How might this impact your independence? a) Since these are non-restricted entities, there is no impact on your independence b) Since these investments are inherited, there is never an impact on independence c) Independence is only affected if you don't sell the shares within 14 days d) Since you are a covered person, you cannot hold investments in un-restricted entities
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