WGU | WESTERN GOVERNORS UNIVERSITY
WGU D550 Ethics for
Accountants OA Final Exam
Official Practice Exam | 2026/2027 Edition
Questions: 100 Minutes: 90 Passing Score: 80% Recertification: Annual
Table of Contents
Section 1: AICPA Code of Professional Conduct (25 Questions)
Section 2: Independence & Objectivity (20 Questions)
Section 3: Confidentiality & Integrity (20 Questions)
Section 4: Professional Competence & Due Care (15 Questions)
Section 5: Ethical Decision-Making & Regulatory Environment (20 Questions)
Instructions
This practice exam contains 100 multiple-choice questions divided into 5 sections. You have 90 minutes to complete the
entire exam. Select the single best answer for each question. A score of 80% or higher (80 out of 100) is required to
pass. Review each rationale carefully to strengthen your understanding of professional ethics, AICPA standards, and
regulatory requirements for the WGU D550 OA final exam.
WGU D550 Ethics -- 2026/2027 | Passing Score: 80% | Page 1 of 52
,Section | AICPA Code of Professional Conduct -- 2026/2027
Q1 Question 1 of 100
A CPA is reviewing the AICPA Code of Professional Conduct and notes that the Code is
structured in two sections. The conceptual framework approach in the Code requires the
member to perform which action when evaluating a potential threat to compliance?
A. Document the threat in a memo and proceed without further action if the client approves
B. Identify the threat, evaluate its significance, and apply safeguards to eliminate or
reduce it to an acceptable level
C. Immediately withdraw from the engagement upon identifying any threat regardless of severity
D. Report the threat to the AICPA Professional Ethics Division before continuing the engagement
Correct Answer: B
Rationale:
The conceptual framework requires identifying threats, evaluating their significance, and applying
safeguards to eliminate or reduce them to an acceptable level. Simply documenting or proceeding
without safeguards is insufficient, immediate withdrawal is not required for all threats, and reporting to
the AICPA is not the first step in the framework.
Q2 Question 2 of 100
A newly licensed CPA is uncertain about whether a particular action complies with the
AICPA Code of Professional Conduct. According to the Code, the CPA should take which
step to resolve this uncertainty?
A. Rely solely on personal judgment since the Code is advisory only
B. Consult the Code's interpretations and rulings, and if still uncertain, seek guidance
from the AICPA Ethics Division
C. Ask the client whether the action is acceptable to them
D. Follow the practice of the majority of other CPAs in the local area
Correct Answer: B
Rationale:
The AICPA Code directs members to consult its interpretations and rulings for guidance, and to
contact the AICPA Ethics Division if uncertainty remains. The Code is not merely advisory, client
acceptance does not determine professional compliance, and majority practice does not ensure
compliance with ethical standards.
WGU D550 Ethics -- 2026/2027 | Passing Score: 80% | Page 2 of 52
,Q3 Question 3 of 100
A CPA serves as the controller for a publicly traded company and is asked by the CEO to
record revenue for a sale that has not yet been completed. The CPA refuses and is
threatened with termination. Under the AICPA Code, the CPA's obligation is to perform
which action?
A. Comply with the CEO's directive since the CEO has final authority over financial reporting
B. Record the revenue and then anonymously report the CEO to the SEC
C. Resign immediately without informing the audit committee of the reason
D. Maintain professional integrity and refuse to record the premature revenue, even at the
risk of termination
Correct Answer: D
Rationale:
The AICPA Code requires members to maintain professional integrity and objectivity, which means
refusing to misstate financial results even under pressure. Complying with the CEO would violate the
Code, anonymous SEC reporting does not address the immediate ethical violation, and resigning
without disclosure allows the misstatement to continue.
Q4 Question 4 of 100
An accounting firm is considering offering advisory services to an audit client. The firm
evaluates the engagement under the AICPA Code's conceptual framework and identifies a
self-review threat. The firm should take which action before accepting the engagement?
A. Evaluate whether safeguards can eliminate or reduce the self-review threat to an
acceptable level, and decline if they cannot
B. Accept the engagement since advisory services are always permitted for audit clients
C. Decline the engagement immediately because any self-review threat is always unacceptable
D. Accept the engagement and disclose the threat in the audit report footnotes
Correct Answer: A
Rationale:
The conceptual framework requires evaluating whether safeguards can reduce the self-review threat
to an acceptable level, and declining the engagement if they cannot. Advisory services are not always
permitted, self-review threats are not automatically fatal if safeguards exist, and footnote disclosure
does not resolve the independence impairment.
WGU D550 Ethics -- 2026/2027 | Passing Score: 80% | Page 3 of 52
, Q5 Question 5 of 100
A CPA in public practice discovers that a colleague at the firm has violated the AICPA
Code of Professional Conduct by failing to perform adequate audit procedures. The CPA's
ethical obligation under the Code is to take which action?
A. Ignore the violation since reporting a colleague violates the duty of loyalty to the firm
B. Confront the colleague and demand they self-report to the state board
C. Report the violation through the firm's internal procedures and, if not resolved,
consider reporting to the appropriate authority
D. Immediately report the colleague to the SEC and the AICPA simultaneously
Correct Answer: C
Rationale:
The AICPA Code requires members to report violations through internal firm procedures first, and if
the firm does not take appropriate action, consider reporting to external authorities. Ignoring the
violation is itself an ethical failure, self-reporting demands may not be effective, and immediate
external reporting bypasses proper internal channels.
Q6 Question 6 of 100
A CPA is a member of the AICPA and works in industry as a corporate accountant. The
member learns that the company is engaging in fraudulent financial reporting. Under the
AICPA Code, a member in industry has which obligation when they become aware of
fraud?
A. No obligation exists because the AICPA Code only applies to members in public practice
B. Resign from the position immediately without any further disclosure
C. Take appropriate action to resolve the issue, which may include reporting to higher
authority within the organization or, if necessary, to appropriate external authority
D. Wait until the annual audit to let the external auditors discover the fraud
Correct Answer: C
Rationale:
The AICPA Code applies to all members, including those in industry, and requires them to take
appropriate action to resolve ethical violations, including escalating within the organization or to
external authorities. The Code is not limited to public practice, resignation alone does not resolve the
issue, and waiting for auditors delays necessary corrective action.
WGU D550 Ethics -- 2026/2027 | Passing Score: 80% | Page 4 of 52
WGU D550 Ethics for
Accountants OA Final Exam
Official Practice Exam | 2026/2027 Edition
Questions: 100 Minutes: 90 Passing Score: 80% Recertification: Annual
Table of Contents
Section 1: AICPA Code of Professional Conduct (25 Questions)
Section 2: Independence & Objectivity (20 Questions)
Section 3: Confidentiality & Integrity (20 Questions)
Section 4: Professional Competence & Due Care (15 Questions)
Section 5: Ethical Decision-Making & Regulatory Environment (20 Questions)
Instructions
This practice exam contains 100 multiple-choice questions divided into 5 sections. You have 90 minutes to complete the
entire exam. Select the single best answer for each question. A score of 80% or higher (80 out of 100) is required to
pass. Review each rationale carefully to strengthen your understanding of professional ethics, AICPA standards, and
regulatory requirements for the WGU D550 OA final exam.
WGU D550 Ethics -- 2026/2027 | Passing Score: 80% | Page 1 of 52
,Section | AICPA Code of Professional Conduct -- 2026/2027
Q1 Question 1 of 100
A CPA is reviewing the AICPA Code of Professional Conduct and notes that the Code is
structured in two sections. The conceptual framework approach in the Code requires the
member to perform which action when evaluating a potential threat to compliance?
A. Document the threat in a memo and proceed without further action if the client approves
B. Identify the threat, evaluate its significance, and apply safeguards to eliminate or
reduce it to an acceptable level
C. Immediately withdraw from the engagement upon identifying any threat regardless of severity
D. Report the threat to the AICPA Professional Ethics Division before continuing the engagement
Correct Answer: B
Rationale:
The conceptual framework requires identifying threats, evaluating their significance, and applying
safeguards to eliminate or reduce them to an acceptable level. Simply documenting or proceeding
without safeguards is insufficient, immediate withdrawal is not required for all threats, and reporting to
the AICPA is not the first step in the framework.
Q2 Question 2 of 100
A newly licensed CPA is uncertain about whether a particular action complies with the
AICPA Code of Professional Conduct. According to the Code, the CPA should take which
step to resolve this uncertainty?
A. Rely solely on personal judgment since the Code is advisory only
B. Consult the Code's interpretations and rulings, and if still uncertain, seek guidance
from the AICPA Ethics Division
C. Ask the client whether the action is acceptable to them
D. Follow the practice of the majority of other CPAs in the local area
Correct Answer: B
Rationale:
The AICPA Code directs members to consult its interpretations and rulings for guidance, and to
contact the AICPA Ethics Division if uncertainty remains. The Code is not merely advisory, client
acceptance does not determine professional compliance, and majority practice does not ensure
compliance with ethical standards.
WGU D550 Ethics -- 2026/2027 | Passing Score: 80% | Page 2 of 52
,Q3 Question 3 of 100
A CPA serves as the controller for a publicly traded company and is asked by the CEO to
record revenue for a sale that has not yet been completed. The CPA refuses and is
threatened with termination. Under the AICPA Code, the CPA's obligation is to perform
which action?
A. Comply with the CEO's directive since the CEO has final authority over financial reporting
B. Record the revenue and then anonymously report the CEO to the SEC
C. Resign immediately without informing the audit committee of the reason
D. Maintain professional integrity and refuse to record the premature revenue, even at the
risk of termination
Correct Answer: D
Rationale:
The AICPA Code requires members to maintain professional integrity and objectivity, which means
refusing to misstate financial results even under pressure. Complying with the CEO would violate the
Code, anonymous SEC reporting does not address the immediate ethical violation, and resigning
without disclosure allows the misstatement to continue.
Q4 Question 4 of 100
An accounting firm is considering offering advisory services to an audit client. The firm
evaluates the engagement under the AICPA Code's conceptual framework and identifies a
self-review threat. The firm should take which action before accepting the engagement?
A. Evaluate whether safeguards can eliminate or reduce the self-review threat to an
acceptable level, and decline if they cannot
B. Accept the engagement since advisory services are always permitted for audit clients
C. Decline the engagement immediately because any self-review threat is always unacceptable
D. Accept the engagement and disclose the threat in the audit report footnotes
Correct Answer: A
Rationale:
The conceptual framework requires evaluating whether safeguards can reduce the self-review threat
to an acceptable level, and declining the engagement if they cannot. Advisory services are not always
permitted, self-review threats are not automatically fatal if safeguards exist, and footnote disclosure
does not resolve the independence impairment.
WGU D550 Ethics -- 2026/2027 | Passing Score: 80% | Page 3 of 52
, Q5 Question 5 of 100
A CPA in public practice discovers that a colleague at the firm has violated the AICPA
Code of Professional Conduct by failing to perform adequate audit procedures. The CPA's
ethical obligation under the Code is to take which action?
A. Ignore the violation since reporting a colleague violates the duty of loyalty to the firm
B. Confront the colleague and demand they self-report to the state board
C. Report the violation through the firm's internal procedures and, if not resolved,
consider reporting to the appropriate authority
D. Immediately report the colleague to the SEC and the AICPA simultaneously
Correct Answer: C
Rationale:
The AICPA Code requires members to report violations through internal firm procedures first, and if
the firm does not take appropriate action, consider reporting to external authorities. Ignoring the
violation is itself an ethical failure, self-reporting demands may not be effective, and immediate
external reporting bypasses proper internal channels.
Q6 Question 6 of 100
A CPA is a member of the AICPA and works in industry as a corporate accountant. The
member learns that the company is engaging in fraudulent financial reporting. Under the
AICPA Code, a member in industry has which obligation when they become aware of
fraud?
A. No obligation exists because the AICPA Code only applies to members in public practice
B. Resign from the position immediately without any further disclosure
C. Take appropriate action to resolve the issue, which may include reporting to higher
authority within the organization or, if necessary, to appropriate external authority
D. Wait until the annual audit to let the external auditors discover the fraud
Correct Answer: C
Rationale:
The AICPA Code applies to all members, including those in industry, and requires them to take
appropriate action to resolve ethical violations, including escalating within the organization or to
external authorities. The Code is not limited to public practice, resignation alone does not resolve the
issue, and waiting for auditors delays necessary corrective action.
WGU D550 Ethics -- 2026/2027 | Passing Score: 80% | Page 4 of 52
