Final answer:
Attending the client's holiday party does not impair a CPA's appearance of independence, as it is considered a normal business courtesy. Owning stock, serving on the board, or having close family ties to client executives are activities that can compromise independence.
Step-by-step explanation:
All of the following are examples of activities that can impair a CPA's appearance of independence EXCEPT attending the client's holiday party. Owning stock in the client company, serving as a board member for the client company, and having a close family member as a key executive in the client company are all situations that could compromise a CPA's independence, either in fact or in appearance. Independence is crucial because it affects stakeholders' confidence in the CPA's work.
Independence in appearance means avoiding circumstances that would lead a knowledgeable third party to reasonably conclude that the CPA's objectivity, integrity, or professional skepticism had been compromised. Attending a holiday party is generally accepted as a normal business courtesy, unlike the other choices that create conflicts of interest or perceptions of bias.