Final answer:
Bookkeeping services are the only non-audit service permitted for an SEC audit client. SEC audit clients are generally permitted to receive non-audit services such as legal services from their audit firm, as this does not typically compromise auditor independence. The correct answer is B.
Step-by-step explanation:
For an SEC audit client, bookkeeping services are the only non-audit service that is permitted. A bookkeeping service involves recording, organizing, and maintaining financial transactions and records. However, all other non-audit services, including internal audit services, appraisal or valuation services, and legal services, are not permitted for an SEC audit client as they can present a conflict of interest and compromise auditor independence.
SEC audit clients are generally permitted to receive non-audit services such as legal services from their audit firm, as this does not typically compromise auditor independence. Other services like internal audit, bookkeeping, and appraisal are usually not allowed.
The question asks which non-audit service is permitted for an SEC audit client. Current regulations set by the Sarbanes-Oxley Act of 2002 restrict the non-audit services that auditors can provide to their audit clients, in order to maintain auditor independence. Of the options provided, Non-audit services such as legal services are typically allowed if they are not seen as conflicting with the role of an auditor. However, services like internal audit, bookkeeping, and appraisal or valuation services are generally prohibited because they might appear to compromise the auditor’s objectivity and independence.