Which of the following statements is True? An audit firm will breach Section 290 of the Code of Ethics on financial interest if:

Question

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Explanation: According to Section 290 of the Code of Ethics, audit team members are prohibited from having any direct financial interest in an audit client, regardless of the amount. This ensures independence and objectivity in the audit process. Choices A, B, and C do not necessarily breach the code under specific circumstances, but a staff auditor directly involved in the audit acquiring stock in the client clearly violates the independence requirements.

Which of the Following Statements Is True? an Audit Firm