• Tom is the financial statement auditor of X Inc., a publicly traded company. His sister Patricia works at X. Toms independence would be impaired if:
  1. Patricia works in the marketing department.
  2. Patricia is in charge of the internal audit department.
  3. Patricia works in the internal audit department.
  4. All of the above.
  5. 2 and 3 only.
• An example of a safeguard implemented by the client to protect the auditors independence could be:
  1. GAAS rules on independence.
  2. Proper training of the auditor.
  3. Independence rules in the Securities Acts.
  4. Quality control by the audit firm.
  5. An active audit committee.