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Question 1: Green &Green. CPAs plan on dating and Issuing their report on March 15. 20X3 on Gearty Mfg.'s calendar year financial statements for 20X2. Their audit report for this company was dated and issued on March 10.20X2 for the calendar year 20X1. Due to a cash shortage caused by major capital expenditures, Green & Green, CPAs billed and were paid in 20X2 for one half of their fee for the 20X1 audit They had agreed with Gearty Mfg. to bill the other half of the fee for the 20X1 audit when they billed them for the 20X2 audit. Which of the following statements is correct?
Point A) Since Green & Green. CPAs and Gearty Mfg. had agreed to this plan of payment for the 20X1 audit,
Point B) Green & Green. CPAs' fees for the 20X1 audit have no bearing on whether or not they arethey are independent. Independent of the Gearty Mfg. 20X2 financial statements.
Point C) Since Green & Green. CPAs has not billed Gearty Mfg. for the second half of the 20X1 audit fee.
Point D) Since they have not been paid for work that must have been done before March 10.20X2. they are are independent. not independent
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