CPA Ethics Exam
1. Which category contains the ethical standards, a violation
of which makes a member liable to disciplinary action?
(a) Ethics Rulings.
(b) Interpretations of the Rules.
(c) Rules.: (c) is the conect answer. Code of Professional
Conduct, Strncture, says that infraction of any of the rules makes
a member liable to disciplinary action.
(a) is wrong since members who depart from the guidance in
ethical rulings in similar circumstances will be asked to justify
such departure. They cannot however be charged with violating a
ruling.
(b) is also wrong since a member cannot be
charged with violating an interpretation. In a disciplina1y hearing
where the member was charged with
,violating a rnle, the member would have the burden of justifying
any departure from interpretations ofthat rule.
2. The Trial Board may, after a hearing, do two of the three
things listed below. Mark the one that the Trial Board cannot
do.
(a) Suspend a member.
(b) Suspend the member's CPA certificate.
( c) Expel a member.: (b) is the correct answer. Code of
Professional
Conduct, Enforcement, says a Trial Board may admonish,
suspend or expel a member. The Trial Board has no jurisdiction
over a member's CPA certificate.
3. Which of the following requires that any changes in them
be approved by the members of the AICPA?
(a) Rules and interpretations of the rules. (b) Principles and
rules.
(c) Principles, rules and interpretations of the rules.: (b) is
correct. Code of
,Professional Conduct,
Structure, says that Principles and Rules must be approved by the
AI CPA members.
(a) is wrong and ...
( c) is wrong since interpretations are prepared and issued by the
Professional Ethics
Executive Committee without obtaining approval by the members.
4. The results of a guilty finding by a Trial Board will be:
(a) published by the AICPA, but the member 's name will not
be disclosed. (b) published by the AICPA. and the member 's
name will be disclosed if the Trial Board votes to do
so.
(c) published by the AICPA with the member 's
name given.: (c) is correct. Code of Professional Conduct,
Enforcement says that Trial Board convictions must
be published with the member's name disclosed.
(a) is then wrong since the name must be disclosed.
, (b) is also wrong since the Trial Board does not have the option of
deciding whether or not the member's name will be disclosed.
5. An interpretation or ethics ruling usually becomes
effective:
(a) the first day of the month following the
month it is published in the Journal of Accountancy. (b) two
weeks after it is published in The CPA
Letter.
(c) the last day of the month in which it is
published in the Journal of Accountancy.: (c) is corect. Code
of Professional
Conduct,
Structure, says that interpretations and rulings are
normally effective the last day of the month they are published in
the Journal of
Accountancy.
(a) and (b) are therefore wrong.
1. Which category contains the ethical standards, a violation
of which makes a member liable to disciplinary action?
(a) Ethics Rulings.
(b) Interpretations of the Rules.
(c) Rules.: (c) is the conect answer. Code of Professional
Conduct, Strncture, says that infraction of any of the rules makes
a member liable to disciplinary action.
(a) is wrong since members who depart from the guidance in
ethical rulings in similar circumstances will be asked to justify
such departure. They cannot however be charged with violating a
ruling.
(b) is also wrong since a member cannot be
charged with violating an interpretation. In a disciplina1y hearing
where the member was charged with
,violating a rnle, the member would have the burden of justifying
any departure from interpretations ofthat rule.
2. The Trial Board may, after a hearing, do two of the three
things listed below. Mark the one that the Trial Board cannot
do.
(a) Suspend a member.
(b) Suspend the member's CPA certificate.
( c) Expel a member.: (b) is the correct answer. Code of
Professional
Conduct, Enforcement, says a Trial Board may admonish,
suspend or expel a member. The Trial Board has no jurisdiction
over a member's CPA certificate.
3. Which of the following requires that any changes in them
be approved by the members of the AICPA?
(a) Rules and interpretations of the rules. (b) Principles and
rules.
(c) Principles, rules and interpretations of the rules.: (b) is
correct. Code of
,Professional Conduct,
Structure, says that Principles and Rules must be approved by the
AI CPA members.
(a) is wrong and ...
( c) is wrong since interpretations are prepared and issued by the
Professional Ethics
Executive Committee without obtaining approval by the members.
4. The results of a guilty finding by a Trial Board will be:
(a) published by the AICPA, but the member 's name will not
be disclosed. (b) published by the AICPA. and the member 's
name will be disclosed if the Trial Board votes to do
so.
(c) published by the AICPA with the member 's
name given.: (c) is correct. Code of Professional Conduct,
Enforcement says that Trial Board convictions must
be published with the member's name disclosed.
(a) is then wrong since the name must be disclosed.
, (b) is also wrong since the Trial Board does not have the option of
deciding whether or not the member's name will be disclosed.
5. An interpretation or ethics ruling usually becomes
effective:
(a) the first day of the month following the
month it is published in the Journal of Accountancy. (b) two
weeks after it is published in The CPA
Letter.
(c) the last day of the month in which it is
published in the Journal of Accountancy.: (c) is corect. Code
of Professional
Conduct,
Structure, says that interpretations and rulings are
normally effective the last day of the month they are published in
the Journal of
Accountancy.
(a) and (b) are therefore wrong.
