Choice "B" is correct. If the accountant has compiled the financial statements of a nonissuer, and the compiled financial statements are not expected to be used by a third party, the accountant may decline to issue a compilation report.
Choice "a" is incorrect, since SSARS allow the accountant to decline to issue a compilation report when the compiled financial statements are not expected to be used by a third party.
Choice "d" is incorrect, since there is no requirement that the accountant be independent when the accountant declines to issue a compilation report. Note that an accountant who lacks independence is still permitted to compile the financial statements of a nonissuer entity.
Choice "c" is incorrect, since there is no requirement that the financial statements be prepared in conformity with GAAP when the accountant declines to issue a compilation report.