10 For a public company an audit committee must be comprised

10. For a public company, an audit committee must be comprised of outside directors. An example of an outside director would be a. A director who is not a member of management and has no other relationship to the organization. b. A director who is the audit partner of the CPA firm selected to audit the company. c. A director who is also a member of management and has no other relationship to the company. d. A director who is a CPA and works as the controller of a subsidiary of the company

Solution

the correct answer should be (a) a director who is not a member of management and has no other relationship to the organization.

as per definition of outside independent director means who has not any material relationship with the company and other option shows material relationship with company that\'s why chose option A.

In case of further clarification/wrong answer please comment.