According to the profession's ethical standards, an auditor would be considered independent in which one of the following instances?
A) The client owes the auditor fees for the last two annual audits.
B) An employee of the audit firm acts as the honorary treasurer for a charity that is an audit client.
C) The auditor's main bank account is held at a client financial institution.
D) The auditor is also a solicitor advising the client.

Question

Quizplus · Accepted Answer

The auditor maintaining a main bank account at a client financial institution does not, in itself, impair independence as long as the account is operated under normal commercial terms. The other options (A, B, and D) describe situations that could impair an auditor's independence due to financial interests, management roles, or provision of non-audit services to the audit client.

According to the Profession's Ethical Standards, an Auditor Would Be