Rocky Point Brewery (RPB) plans to file an initial public offering (IPO) in June 20X3. Olsen & Alain, CPAs (O&A) has performed calendar year end audits of RPB since 20X0 and also helps RPB prepare monthly financial statements in accordance with AICPA independence rules. O&A terminated the accounting services in December 20X2. Under SEC independence rules, could RPB continue to engage O&A as its auditor when it files its IPO?

Yes, because the prohibited nonaudit services were performed before the period of professional engagement. Yes, but only if O&A rescinds any indemnification language existing in their nonaudit engagement letters.

Yes, but only if O&A rescinds any indemnification language existing in their nonaudit engagement letters.

No, because the prohibited nonaudit services were performed during the period covered by the financial statements.

No, but only if the fees O&A received from these engagements exceeded five percent of the firm's annual revenues.

Answer rating: 100% (QA)

No because the prohibited nonaudit servic... View the full answer