7. Which of the following is allowable for a CPA? A. A car loan from a bank client where the bank is normally in the business of making car loans and the terms are no different from typical borrowers. B. An uncollateralized signature loan from a client. C. Owning more than 5% of the outstanding shares of client stock in a retirement account. D. The audit engagement partner serves on the client's audit committee.

8. We learned in Chapter 19 that Covered Members (see PPT 19-8) must be independent of the audit client. Covered Members also must be independent of affiliates of the audit client. What would be an example of an affiliate of the audit client? A. A corporation that owns more than 20% of your audit client. B. A corporation that your audit client owns more than 20% of. C. Both A and B are examples of an affiliate of the audit client D. Neither A nor B are examples of an affiliate of the audit client.