Moshe $($an audit manager$)$ has been assigned to the audit of Tandem Electric, Inc. Moshe is concerned that Barry, a childhood friend, is on the internal audit staff of Tandem Electric. Moshe believes he could provide services to this client in an objective manner but is concerned about the appearance of his independence. He applies the AICPA conceptual framework approach and determines that threats to his independence are significant. Which statement best describes what Moshe should do next in applying the conceptual framework?

Document his assessment of independence, which should include a sworn statement from Barry.

Not participate in the audit unless he obtains a waiver from his firm's general counsel.

Consider whether safeguards may be applied that reduce the threats to an acceptable level.

Ask his friend to resign his position at Tandem Electric immediately.