Generally, loans between a CPA firm or its members and an audit client are prohibited because they create a financial relationship. However, there are exceptions. Which of the following loans is not an exception to this rule?

Question

Quizplus · Accepted Answer

Automobile loans, loans fully collateralized by cash deposits at the same financial institution, and home mortgages are all exceptions to the rule, as they are considered routine consumer loans. However, unpaid credit card balances are not an exception, as they are not considered a loan with a stated repayment period and interest rate.

Generally, Loans Between a CPA Firm or Its Members and an Audit