Which of the following examples would NOT be considered a prohibited activity?
Understand the Problem
The question is asking which example provided does not constitute a prohibited activity for a CPA in relation to attest clients. It requires an understanding of ethical guidelines and regulations that govern CPA practices.
Answer
A CPA owns a mutual fund that owns shares in an attest client but is not material to the covered member.
The final answer is: A CPA owns a mutual fund that owns shares in an attest client but is not material to the covered member.
Answer for screen readers
The final answer is: A CPA owns a mutual fund that owns shares in an attest client but is not material to the covered member.
More Information
Owning a mutual fund with shares in an attest client is typically allowed if the investment is not material to the CPA, as it is considered an indirect financial interest.
Tips
A common mistake is not understanding the difference between direct and indirect financial interests. Ensure the materiality of the investment is assessed.
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