In which of the following instances would the independence of the CPA not be considered to be impaired? The CPA has been retained as the auditor of a brokerage firm
A) which owes the CPA audit fees for more than one year.
B) in which the CPA has a large active margin account.
C) in which the CPA's brother is the controller.
D) which owes the CPA audit fees for current year services and has just filed a petition for bankruptcy.

Question

Quizplus · Accepted Answer

The independence of the CPA would not be considered impaired if the brokerage firm owes audit fees for current year services and has just filed for bankruptcy. This situation does not involve any personal relationship, financial interest, or business relationship that would compromise the CPA's objectivity and impartiality. However, in the other options, the CPA's independence would be considered impaired because of the overdue audit fees in option A, the large active margin account in option B, and the family relationship in option C.

In Which of the Following Instances Would the Independence of the CPA