AICPA CODE OF CONDUCT QUESTIONS AND
ANSWERS
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.
ANSWERS
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.
