An audit committee must be comprised of outside directors and at least one outside financial expert.An individual with which of the following characteristics is considered an outside director?

Question

Quizplus · Accepted Answer

An outside director is a director who is not a member of management and has no other relationship to the organization. This ensures that the audit committee is independent and objective in overseeing the financial reporting process. Option B is incorrect as a consultant is not considered an outside director. Option C is incorrect as a director who is also a member of management is an insider director. Option D is incorrect as a director who is affiliated with another organization may not be considered independent.

An Audit Committee Must Be Comprised of Outside Directors and at Least