Thorp, CPA, was engaged to audit Ivor Co.’s financial statements. During the audit, Thorp discovered that Ivor’s inventory contained stolen goods. Ivor was indicted and Thorp was subpoenaed to testify at the criminal trial. Ivor claimed accountant-client privilege to prevent Thorp from testifying. Which of the following statements is correct regarding Ivor’s claim?

  1. Ivor can claim an accountant-client privilege only in states that have enacted a statute creating such a privilege.
  2. Ivor can claim an accountant-client privilege only in federal courts.
  3. The accountant-client privilege can be claimed only in civil suits.
  4. The accountant-client privilege can be claimed only to limit testimony to audit subject matter.