AICPA ETHICS CODE EXAM ACTUAL
PAPER SOLVED QUESTIONS
◉ , the acquiring firm's
independence would not be impaired.
Answer: If the acquired firm provided prohibited nonattest
services to an attest client of the acquiring firm prior
to the financial statement period covered by the acquiring firm's
next attest report=
◉ a. The acquired firm terminates the prohibited nonattest
services (or modifies the service offerings such
that they would not impair independence) prior to the closing
date of the merger or acquisition.
b. Any individual who participated in the engagement to provide
the prohibited nonattest services
is neither on the attest engagement team nor an individual in a
position to influence the attest
engagement.
c. An evaluation of the threats is performed and threats are
determined to be at an acceptable level or
reduced to an acceptable level by the application of safeguards.
The evaluation should be conducted
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50
, on the basis of the attribution of the results of the nonattest
services to the acquiring firm. That is,
if the nonattest services
i. can be attributed to the acquiring firm because the acquiring
firm will assume responsibility for
the results of the nonattest services, then t
Answer: If the acquired firm provided prohibited nonattest
services to an attest client of the acquiring firm during the
period of the professional engagement (except as provided for in
paragraph .06) or the period covered by
the financial statements, the acquiring firm's independence would
be impaired unless all of the following
conditions are satisfied:
◉ a. An individual not associated with the nonattest engagement
reviews the nonattest services work
performed.
b. Another firm performs an attest engagement on the subject
matter of the nonattest service.
c. Another firm re-performs the nonattest service to the extent
necessary for it to take responsibility
for that service.
If no safeguards exist that will eliminate or reduce the threats to
an acceptable level, independence will
be impaired.
Answer: non attest client safegaurds
PAPER SOLVED QUESTIONS
◉ , the acquiring firm's
independence would not be impaired.
Answer: If the acquired firm provided prohibited nonattest
services to an attest client of the acquiring firm prior
to the financial statement period covered by the acquiring firm's
next attest report=
◉ a. The acquired firm terminates the prohibited nonattest
services (or modifies the service offerings such
that they would not impair independence) prior to the closing
date of the merger or acquisition.
b. Any individual who participated in the engagement to provide
the prohibited nonattest services
is neither on the attest engagement team nor an individual in a
position to influence the attest
engagement.
c. An evaluation of the threats is performed and threats are
determined to be at an acceptable level or
reduced to an acceptable level by the application of safeguards.
The evaluation should be conducted
Part 1 — Members in Public Practice
50
, on the basis of the attribution of the results of the nonattest
services to the acquiring firm. That is,
if the nonattest services
i. can be attributed to the acquiring firm because the acquiring
firm will assume responsibility for
the results of the nonattest services, then t
Answer: If the acquired firm provided prohibited nonattest
services to an attest client of the acquiring firm during the
period of the professional engagement (except as provided for in
paragraph .06) or the period covered by
the financial statements, the acquiring firm's independence would
be impaired unless all of the following
conditions are satisfied:
◉ a. An individual not associated with the nonattest engagement
reviews the nonattest services work
performed.
b. Another firm performs an attest engagement on the subject
matter of the nonattest service.
c. Another firm re-performs the nonattest service to the extent
necessary for it to take responsibility
for that service.
If no safeguards exist that will eliminate or reduce the threats to
an acceptable level, independence will
be impaired.
Answer: non attest client safegaurds
