Family Relationships Flashcards
What are the two categories of family relationships?
1) Immediate family members: Spouse, spouse equivalents, and depends
2) Close Relatives- Parents, siblings, and non-depdent children
What are the rules for immediate family members for employment?
Rules: They must follow the same rules as CMs
Immediately family members cannot own cumulatively more than 5% of an attest client
Employment rules: Can work for an attest client but they cannot work in a KEY POSITION includes:
- Primary accounting functions
- Primary responsibility for F/S
- Exercise influence over the F/S
- BOD, CEO, president, CFO, COO, CAO, controller, director of Financial, treasurer
What are the rules for immediately family members who participate in an employee benefit plan that is an attest client?
allowed if:
1) The plan needs to be offered to all employment positions
2) Should not serve is a position of control over the benefit plan
3) Should not have ability to supervise or selection of investment options
What are t he rules for immediate family members who participate in an employment benefit plan with financial interest in an attest client:
1) The CM is neither on the attest team nor a PTI
2) All employees are treated the same
3) if the plan creates an option that would allow the IMF to invest in a non attest client, they should get rid of client shares
What are the rules for close relatives for employment?
Independence is impaired if:
1) A key position with an attest client
2) A financial interest in the attest client that:
- knows or has reason to know that was material to the close relative
- Enable the close relative to exercise significant influence over the attest client