6 EXERCISES . During the past two years, you audited the finan- cial statements

6 EXERCISES
. During the past two years, you audited the finan- cial statements of many clients, including Zohank Company. After one of your individual clients had a stroke, she created a living trust and appointed
you as the trustee. According to the trust documents, you may disburse “funds on behalf of the grantor to adequately satisfy her medical needs.” You may not, however, alter the trust’s investment portfolio. The trust’s total investment portfolio is worth $1 mil- lion and is comprised of five different stocks, each of which represents 20% of the value of the trust’s assets. Zohank Company common stock is one of the five stocks held in the trust’s portfolio. Do you retain the independence to audit Zohank Company? 2.While acting as a fiduciary, you recommended that your client buy a particular brand of refueling sta- tion to charge her new, electricity-powered car. You told your client that she would be able to save 70% of the purchase price of the home refueling station through a combination of tax credits and utility rebates. You were correct, and the client achieved these savings. However, you did not tell the client that you were receiving a $200 commission from the manufacturer of that particular refueling station brand. Your client now is furious that you received this commission and never told her about it. Do you owe your client $200?