Exam (elaborations)
AICPA CODE OF CONDUCT QUESTIONS AND ANSWERS
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AICPA CODE OF CONDUCT QUESTIONS AND ANSWERS
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AICPA CODE OF CONDUCT QUESTIONS ANDANSWERS
What are the 6 Principles of the AICPA Code of Professional Conduct? - Answers -1.
Responsibilities
2. The Public Interest
3. Integrity
4. Objectivity
5. Due Care
6. Scope and Nature of Services
What is the Structure of the AICPA Code of Professional Conduct? - Answers -Preface
Code Part 1: Members in Public
Code Part 2: Members in Business
Code Part 3: Other Members
Where in the AICPA are the 6 principles found? - Answers -The Preface
Which section establishes the conceptual framework and provides a methodology for
resolving ethical conflicts? - Answers -Code 1: Members in Public
What are the 7 categories of threat? - Answers -1. Adverse Interest
2. Advocacy
3. Familiarity
4. Management Participation
5. Self - Interest
6. Self Review
7. Undue Influence
Define Adverse Interest Threat - Answers -The threat that a member will not act with
objectivity because the member's interests are opposed to the client's interest
Define Advocacy Threat - Answers -The threat that a member will promote a client's
interest to the point that the member's objectivity or independence is compromised
, Define Familiarity Threat - Answers -A member will become too sympathetic due to long
or close relationship
Define Management Participation - Answers -A member will take on the role of client
management
Define Self Interest Threat - Answers -A member could benefit from an interest with a
client
Define Self Review Threat - Answers -Threat that a manner will not appropriately
evaluate the results of a previous judgment made or service performed and that the
member will rely on that service in forming a judgment
What is the rule on Contingent Fees? - Answers -A CPA cannot receive contingent fees
from a client if they also perform an audit, review, compilation, or examination of
Financial Statements or when they prepare an original or amended tax return or claim
for a tax refund for a contingent fee for any client.
A member's fee may vary depending, for example, on the complexity of services
rendered. - Answers -A member's fee may vary depending, for example, on the
complexity of services rendered.
To avoid a contingent fee during a trial, the CPA should charge by the hour. - Answers -
To avoid a contingent fee during a trial, the CPA should charge by the hour.
What are the Rules on Commissions and Referral Fees? - Answers -A member cannot
receive commission or referral fees from a client if they also perform the following
services for the client:
Audit, review, compilation, or examination
Same as the Rules on Contingent Fees
What must you do if you can accept commission or referral fees? - Answers -Disclose
the information to the client
Avoiding commission and referral fees provides auditors with greater independence and
objectivity, both in fact and in appearance. In those circumstances where a CPA can
accept a commission or referral fee, being open and honest with the exhibits integrity
and allows the client to make their own judgments about any conflicts that may affect
objectivity. - Answers -Avoiding commission and referral fees provides auditors with
greater independence and objectivity, both in fact and in appearance. In those
circumstances where a CPA can accept a commission or referral fee, being open and
honest with the exhibits integrity and allows the client to make their own judgments
about any conflicts that may affect objectivity.
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