CPA ETHICS EXAM(AICPA)WITH CPA ETHICS EXAM(AICPA)WITH
VERIFIED CORRECT ANSWERS VERIFIED CORRECT ANSWERS
UPDATED 2025 UPDATED 2025
Which category contains the ethical standards, a so.
violation of which makes a member liable to disciplinary (c) published by the AICPA with the member 's
action? name given. - Answer (c) is correct. Code of Professional Conduct,
(a) Ethics Rulings. Enforcement says that Trial Board convictions must
(b) Interpretations of the Rules. be published with the member's name disclosed.
(c) Rules. - Answer (c) is the conect answer. Code of Professional (a) is then wrong since the name must be disclosed.
Conduct, Strncture, says that infraction of any of the rules makes a member liable to (b) is also wrong since the Trial Board does not have the option of deciding whether
disciplinary action. or not the member's name will be disclosed.
(a) is wrong since members who depart from the
guidance in ethical rulings in similar circumstances An interpretation or ethics ruling usually becomes
will be asked to justify such departure. They cannot effective:
however be charged with violating a ruling. (a) the first day of the month following the
(b) is also wrong since a member cannot be month it is published in the Journal of Accountancy.
charged with violating an interpretation. In a disciplina1y (b) two weeks after it is published in The CPA
hearing where the member was charged with Letter.
violating a rnle, the member would have the burden of justifying any departure from (c) the last day of the month in which it is
interpretations ofthat rule. published in the Journal of Accountancy. - Answer (c) is corect. Code of Professional
Conduct,
The Trial Board may, after a hearing, do two of the Structure, says that interpretations and rulings are
three things listed below. Mark the one that the Trial normally effective the last day of the month they are published in the Journal of
Board cannot do. Accountancy.
(a) Suspend a member. (a) and (b) are therefore wrong.
(b) Suspend the member's CPA certificate.
( c) Expel a member. - Answer (b) is the correct answer. Code of Professional A CPA in public practice ______________ avoid operating
Conduct, Enforcement, says a Trial Board may under a code of professional ethics by choosing not
admonish, suspend or expel a member. The Trial to join either the AICPA or any state CPA society.
Board has no jurisdiction over a member's CPA (a) may
certificate. (b) may not - Answer (b) is correct. Code of Professional Conduct, Coverage, says
that no CPA practicing public accounting may avoid operating under a code of
Which of the following requires that any changes in ethics. The CPA may not join the AI CPA or his or her state CPA society and
them be approved by the members of the AICPA? therefore would not be subject to their codes of ethics. The CPA, however, cannot
(a) Rules and interpretations of the rules. avoid being subject to his or her state board of accountancy's code of ethics
(b) Principles and rules.
(c) Principles, rules and interpretations of the rules. - Answer (b) is correct. Code of The accounting profession 's public includes
Professional Conduct, (a) Governmental agencies.
Structure, says that Principles and Rules must be (b) Credit grantors.
approved by the AI CPA members. (c) Investors.
(a) is wrong and ... (d) All of the above - Answer (d) is the correct answer. As (see Article II) the
( c) is wrong since interpretations are prepared and issued by the Professional Ethics CPA's public includes everyone that relies on them. This then would include
Executive Committee without obtaining approval by the members. (a) governmental agencies,
(b) credit grantors and
The results of a guilty finding by a Trial Board will (c) investors.
be:
(a) published by the AICPA, but the member 's name will not be disclosed. Compliance with the AICPA Code of Professional
(b) published by the AICPA. and the member 's name will be disclosed if the Trial Conduct depends primarily on:
Board votes to do (a) Public opinion and reinforcement of one's attestation peers.
, CPA ETHICS EXAM(AICPA)WITH CPA ETHICS EXAM(AICPA)WITH
VERIFIED CORRECT ANSWERS VERIFIED CORRECT ANSWERS
UPDATED 2025 UPDATED 2025
(b) Disciplinary proceedings when the code is (b) All members.
violated. (c) Only members engaged in rendering attestation
(c) Member's understanding the code and voluntary compliance with it. - Answer (c) services. - Answer (b) is correct. The Code of Professional Conduct
is the correct answer. Composition, Applicability provides rules for all members, As stated in the Articles, section Composition, the
and Compliance in the Articles says that compliance with the code, as with all membership
standards in an open society, depends primarily on member 's understanding of the adopted the code to provide guidance and rules for all members-those in public
code and voluntary compliance with it. practice, in
(a) is wrong. This section says that reinforcement by one's peers and public opinion industry, in government and in education.
is secondary
in obtaining compliance with the code. Due care requires a member to:
(b) is also wrong since this section says disciplinary proceedings against those that (a) Perform work for clients at the lowest cost.
violate the code are the ultimate or final method of obtaining compliance. (b) Perform work for the clients with competence
and diligence.
The Principles state that a member has responsibility (c) Complete each year a specified number of
to: hours of Continuing Professional Education
(a) Colleagues. courses. - Answer (b) is correct. Article V requires a member to per-form his
(b) Clients. professional work with competence and diligence.
(c) The public. (a) The Principles do not address the subject of fees or
(d) All of the above. - Answer (d) is correct. The Preamble to the Articles says that (c) Continuing Professional Education.
members have
(a) a responsibility to colleagues, Jones & Barnes, a public accounting firm, has offices
(b) to clients and in Minneapolis, Chicago and 10 other cities. The firm 's
(c) to the public. executive office and the managing partner are in Chicago.
Each office does all the work and issues the audit reports
The Principles in the AICPA Code of Professional for the clients of that office. Black & Co. is an audit client
Conduct ___________________ enforceable under their own terms. of the Minneapolis office.
(a) are. State whether in the following situations the individual
(b) are not. - Answer (b) is correct. Principles are not enforceable under would be a "covered member" with respect to the 2001
their own terms as shown in the section Purpose. Principles are goal-oriented and calendar year audit of Black & Co.
the rules of
ethics are made and adopted within that framework. Gilbert , a tax partner in the Chicago office
(a) is a covered member.
A distinguishing mark of a profession is: (b) is not a covered member. - Answer (b) is correct. (Covered member (d)) includes
(a) Acceptance of its responsibility to the public. partners in the office where the attest engagement
(b) The esteem with which it is held by the public. partner is located. Since Minneapolis does all the
(c) Its ability to influence legislation. - Answer (a) is correct. As stated in Article II, the work for this client the engagement partner has to
distinguishing mark of a profession is acceptance of its responsibility to the public. be in Minneapolis. Gilbert is in the Chicago office
(b) The esteem by which it is held by the public and therefore he is not a covered member.
will come when it shows its responsibility to the public.
(c) Influencing legislation may be important to the profession but it is not the Jones & Barnes, a public accounting firm, has offices
distinguishing in Minneapolis, Chicago and 10 other cities. The firm 's
mark of a profession. executive office and the managing partner are in Chicago.
Each office does all the work and issues the audit reports
The AICPA Code of Professional Conduct provides for the clients of that office. Black & Co. is an audit client
guidance and rules for: of the Minneapolis office.
(a) Only members in public practice. State whether in the following situations the individual
, CPA ETHICS EXAM(AICPA)WITH CPA ETHICS EXAM(AICPA)WITH
VERIFIED CORRECT ANSWERS VERIFIED CORRECT ANSWERS
UPDATED 2025 UPDATED 2025
would be a "covered member" with respect to the 2001 non attest consulting services engagement for Black
calendar year audit of Black & Co. &Co.
(a) is a covered member
Jacobs, an audit manager in the Minneapolis office, (b) is not a covered member - Answer (b) is correct. (Covered member (c)) holds that
who does no work on the Black & Co. engagement. partners or managers who provide ten hours or more of non-attest services to a
(a) is a covered member. client within the year are covered members. Olson however is not a partner or
(b) is not a covered member. - Answer (b) is correct. (Covered member (a)), includes manager, and thus is not a covered member even though he did non-attest services
all for Black & Co.
people that work on the attest engagement team.
Thus professional staff that work on the audit are Jones & Barnes, a public accounting firm, has offices
covered members. Since Jacobs does no work on in Minneapolis, Chicago and 10 other cities. The firm 's
the Black & Co. engagement, he is not a covered executive office and the managing partner are in Chicago.
member. The fact that he is a manager has no bearing on the answer. Each office does all the work and issues the audit reports
for the clients of that office. Black & Co. is an audit client
Jones & Barnes, a public accounting firm, has offices of the Minneapolis office.
in Minneapolis, Chicago and 10 other cities. The firm 's State whether in the following situations the individual
executive office and the managing partner are in Chicago. would be a "covered member" with respect to the 2001
Each office does all the work and issues the audit reports calendar year audit of Black & Co.
for the clients of that office. Black & Co. is an audit client
of the Minneapolis office. Corey, secretary to the Minneapolis office managing
State whether in the following situations the individual partner,
would be a "covered member" with respect to the 2001 (a) is a covered member
calendar year audit of Black & Co. (b) is not a covered member - Answer (b) is correct (Attest engagement team) does
not
Larson, a consulting services partner, in the Minneapolis include those performing routine clerical functions. Thus (Covered member (b)) does
office who has not done any work for Black & Co. not apply to nonprofessional people unless they are in a position where they can
(a) is a covered member influence the attest engagement. Corey, as a secretary, is thus not a covered
(b) is not a covered member - Answer (a) is correct. (Covered member (d)) includes member.
all
partners in the office where the lead attest engagement partner works. Since Porter is a partner in White & Co., CPAs. State whether in
Minneapolis does all the work for this client, the lead attest engagement partner has the following situations the person would be classified as
to be in Minneapolis. Larson is a partner in the Minneapolis office, and therefore he a member of Porter's immediate family.
is a covered member even though he never works on the Black & Co. engagement
Porter's dependent daughter who is away at college
Jones & Barnes, a public accounting firm, has offices (a) is classified as part of Porter's immediate
in Minneapolis, Chicago and 10 other cities. The firm 's family
executive office and the managing partner are in Chicago. (b) is not classified as part of Porter's immediate
Each office does all the work and issues the audit reports family - Answer (a) is correct. (Immediate family) says it includes
for the clients of that office. Black & Co. is an audit client dependents. Even though she is away at college she is still a dependent and thus
of the Minneapolis office. immediate family.
State whether in the following situations the individual
would be a "covered member" with respect to the 2001 Porter is a partner in White & Co., CPAs. State whether in
calendar year audit of Black & Co. the following situations the person would be classified as
a member of Porter's immediate family.
Olson, a professional staff person below the rank of
manager, who worked for two weeks in 2001 on a An elderly aunt of Porter's wife lives in a nursing
, CPA ETHICS EXAM(AICPA)WITH CPA ETHICS EXAM(AICPA)WITH
VERIFIED CORRECT ANSWERS VERIFIED CORRECT ANSWERS
UPDATED 2025 UPDATED 2025
home. Porter and his wife pay the monthly nursing on campus. Their support consists of paying for
home fees and any other expenses the aunt incurs. her tuition, books and supplies, board and room and
a small amount for spending money. She is one of
The aunt several students from foreign countries that members
(a) is classified as part of Porter's immediate of their church have sponsored at the college.
family
(b) is not classified as part of Porter's immediate She is not related to either Porter or his wife.
family - Answer (a) is correct. (Immediate family) says it includes (a) is classified as part of Porter's immediate
dependents. Since Porter pays all her expenses, she is a dependent and thus a family
member of his immediate family (b) is not classified as part of Porter's immediate
family - Answer (a) is correct. (Immediate family) says it includes
Porter is a partner in White & Co., CPAs. State whether in dependents. Since Porter pays all her expenses she is a dependent, and thus she is
the following situations the person would be classified as classified as immediate family.
a member of Porter's immediate family.
The AICPA Rules of the Code of Professional Conduct
Porter's non-dependent son who lives next door to apply to which group?
his father (a) All AICPA members.
(a) is classified as part of Porter's immediate (b) All CPAs who are licensed to practice.
family (c) All CPAs - Answer (a) is correct. (Applicability) section says that the
(b) is not classified as part of Porter's immediate rules apply to all AI CPA members.
family - Answer (b) is correct. (Immediate family) says it includes (b) is wrong because CPAs licensed to practice
one's spouse, spousal equivalent and dependents. who do not belong to the AI CPA are not subject
Porter's son is not dependent on him and is thus not considered immediate family. to AICPA rules.
(c) is also wrong because those CPAs not belonging to the AICPA are not subject to
Porter is a partner in White & Co., CPAs. State whether in AICPA
the following situations the person would be classified as rules.
a member of Porter's immediate family.
The Code of Professional Conduct says that with
Porter's wife who is self-employed and who annually respect to the acts of others:
earns twice as much as Porter earns (a) a member may be held responsible for compliance
(a) is classified as part of Porter's immediate with the rule by all persons associated
family with him in the practice of public accounting
(b) is not classified as part of Porter's immediate who the member has the authority or capacity
family - Answer (a) is correct. (Immediate family) says it includes to control.
spouses. Thus it does not matter how much she (b) a member has no responsibility for the acts of
makes, where she works, etc., Porter's wife is still anyone but himself.
classified as immediate family. (c) it is silent on the matter. - Answer (a) is correct. (Interpretation addressing the
Applicability of the AICPA Code of Professional Conduct) says a member may be
Porter is a partner in White & Co., CPAs. State whether in held responsible for the acts of others that he has the authority to control.
the following situations the person would be classified as
a member of Porter's immediate family. A member wishes to take an action but is told that
it would be against the rules in the Code of Professional
Porter and his wife have been for the last year and Conduct. His secretary then offers to take
are continuing this year to support a woman from the action saying to the member, "I will do it since
South America who is attending the local college. I am not a member of the AI CPA and their rules do
She is currently a sophomore and lives in a dormitory not apply to me." The member makes no comment
VERIFIED CORRECT ANSWERS VERIFIED CORRECT ANSWERS
UPDATED 2025 UPDATED 2025
Which category contains the ethical standards, a so.
violation of which makes a member liable to disciplinary (c) published by the AICPA with the member 's
action? name given. - Answer (c) is correct. Code of Professional Conduct,
(a) Ethics Rulings. Enforcement says that Trial Board convictions must
(b) Interpretations of the Rules. be published with the member's name disclosed.
(c) Rules. - Answer (c) is the conect answer. Code of Professional (a) is then wrong since the name must be disclosed.
Conduct, Strncture, says that infraction of any of the rules makes a member liable to (b) is also wrong since the Trial Board does not have the option of deciding whether
disciplinary action. or not the member's name will be disclosed.
(a) is wrong since members who depart from the
guidance in ethical rulings in similar circumstances An interpretation or ethics ruling usually becomes
will be asked to justify such departure. They cannot effective:
however be charged with violating a ruling. (a) the first day of the month following the
(b) is also wrong since a member cannot be month it is published in the Journal of Accountancy.
charged with violating an interpretation. In a disciplina1y (b) two weeks after it is published in The CPA
hearing where the member was charged with Letter.
violating a rnle, the member would have the burden of justifying any departure from (c) the last day of the month in which it is
interpretations ofthat rule. published in the Journal of Accountancy. - Answer (c) is corect. Code of Professional
Conduct,
The Trial Board may, after a hearing, do two of the Structure, says that interpretations and rulings are
three things listed below. Mark the one that the Trial normally effective the last day of the month they are published in the Journal of
Board cannot do. Accountancy.
(a) Suspend a member. (a) and (b) are therefore wrong.
(b) Suspend the member's CPA certificate.
( c) Expel a member. - Answer (b) is the correct answer. Code of Professional A CPA in public practice ______________ avoid operating
Conduct, Enforcement, says a Trial Board may under a code of professional ethics by choosing not
admonish, suspend or expel a member. The Trial to join either the AICPA or any state CPA society.
Board has no jurisdiction over a member's CPA (a) may
certificate. (b) may not - Answer (b) is correct. Code of Professional Conduct, Coverage, says
that no CPA practicing public accounting may avoid operating under a code of
Which of the following requires that any changes in ethics. The CPA may not join the AI CPA or his or her state CPA society and
them be approved by the members of the AICPA? therefore would not be subject to their codes of ethics. The CPA, however, cannot
(a) Rules and interpretations of the rules. avoid being subject to his or her state board of accountancy's code of ethics
(b) Principles and rules.
(c) Principles, rules and interpretations of the rules. - Answer (b) is correct. Code of The accounting profession 's public includes
Professional Conduct, (a) Governmental agencies.
Structure, says that Principles and Rules must be (b) Credit grantors.
approved by the AI CPA members. (c) Investors.
(a) is wrong and ... (d) All of the above - Answer (d) is the correct answer. As (see Article II) the
( c) is wrong since interpretations are prepared and issued by the Professional Ethics CPA's public includes everyone that relies on them. This then would include
Executive Committee without obtaining approval by the members. (a) governmental agencies,
(b) credit grantors and
The results of a guilty finding by a Trial Board will (c) investors.
be:
(a) published by the AICPA, but the member 's name will not be disclosed. Compliance with the AICPA Code of Professional
(b) published by the AICPA. and the member 's name will be disclosed if the Trial Conduct depends primarily on:
Board votes to do (a) Public opinion and reinforcement of one's attestation peers.
, CPA ETHICS EXAM(AICPA)WITH CPA ETHICS EXAM(AICPA)WITH
VERIFIED CORRECT ANSWERS VERIFIED CORRECT ANSWERS
UPDATED 2025 UPDATED 2025
(b) Disciplinary proceedings when the code is (b) All members.
violated. (c) Only members engaged in rendering attestation
(c) Member's understanding the code and voluntary compliance with it. - Answer (c) services. - Answer (b) is correct. The Code of Professional Conduct
is the correct answer. Composition, Applicability provides rules for all members, As stated in the Articles, section Composition, the
and Compliance in the Articles says that compliance with the code, as with all membership
standards in an open society, depends primarily on member 's understanding of the adopted the code to provide guidance and rules for all members-those in public
code and voluntary compliance with it. practice, in
(a) is wrong. This section says that reinforcement by one's peers and public opinion industry, in government and in education.
is secondary
in obtaining compliance with the code. Due care requires a member to:
(b) is also wrong since this section says disciplinary proceedings against those that (a) Perform work for clients at the lowest cost.
violate the code are the ultimate or final method of obtaining compliance. (b) Perform work for the clients with competence
and diligence.
The Principles state that a member has responsibility (c) Complete each year a specified number of
to: hours of Continuing Professional Education
(a) Colleagues. courses. - Answer (b) is correct. Article V requires a member to per-form his
(b) Clients. professional work with competence and diligence.
(c) The public. (a) The Principles do not address the subject of fees or
(d) All of the above. - Answer (d) is correct. The Preamble to the Articles says that (c) Continuing Professional Education.
members have
(a) a responsibility to colleagues, Jones & Barnes, a public accounting firm, has offices
(b) to clients and in Minneapolis, Chicago and 10 other cities. The firm 's
(c) to the public. executive office and the managing partner are in Chicago.
Each office does all the work and issues the audit reports
The Principles in the AICPA Code of Professional for the clients of that office. Black & Co. is an audit client
Conduct ___________________ enforceable under their own terms. of the Minneapolis office.
(a) are. State whether in the following situations the individual
(b) are not. - Answer (b) is correct. Principles are not enforceable under would be a "covered member" with respect to the 2001
their own terms as shown in the section Purpose. Principles are goal-oriented and calendar year audit of Black & Co.
the rules of
ethics are made and adopted within that framework. Gilbert , a tax partner in the Chicago office
(a) is a covered member.
A distinguishing mark of a profession is: (b) is not a covered member. - Answer (b) is correct. (Covered member (d)) includes
(a) Acceptance of its responsibility to the public. partners in the office where the attest engagement
(b) The esteem with which it is held by the public. partner is located. Since Minneapolis does all the
(c) Its ability to influence legislation. - Answer (a) is correct. As stated in Article II, the work for this client the engagement partner has to
distinguishing mark of a profession is acceptance of its responsibility to the public. be in Minneapolis. Gilbert is in the Chicago office
(b) The esteem by which it is held by the public and therefore he is not a covered member.
will come when it shows its responsibility to the public.
(c) Influencing legislation may be important to the profession but it is not the Jones & Barnes, a public accounting firm, has offices
distinguishing in Minneapolis, Chicago and 10 other cities. The firm 's
mark of a profession. executive office and the managing partner are in Chicago.
Each office does all the work and issues the audit reports
The AICPA Code of Professional Conduct provides for the clients of that office. Black & Co. is an audit client
guidance and rules for: of the Minneapolis office.
(a) Only members in public practice. State whether in the following situations the individual
, CPA ETHICS EXAM(AICPA)WITH CPA ETHICS EXAM(AICPA)WITH
VERIFIED CORRECT ANSWERS VERIFIED CORRECT ANSWERS
UPDATED 2025 UPDATED 2025
would be a "covered member" with respect to the 2001 non attest consulting services engagement for Black
calendar year audit of Black & Co. &Co.
(a) is a covered member
Jacobs, an audit manager in the Minneapolis office, (b) is not a covered member - Answer (b) is correct. (Covered member (c)) holds that
who does no work on the Black & Co. engagement. partners or managers who provide ten hours or more of non-attest services to a
(a) is a covered member. client within the year are covered members. Olson however is not a partner or
(b) is not a covered member. - Answer (b) is correct. (Covered member (a)), includes manager, and thus is not a covered member even though he did non-attest services
all for Black & Co.
people that work on the attest engagement team.
Thus professional staff that work on the audit are Jones & Barnes, a public accounting firm, has offices
covered members. Since Jacobs does no work on in Minneapolis, Chicago and 10 other cities. The firm 's
the Black & Co. engagement, he is not a covered executive office and the managing partner are in Chicago.
member. The fact that he is a manager has no bearing on the answer. Each office does all the work and issues the audit reports
for the clients of that office. Black & Co. is an audit client
Jones & Barnes, a public accounting firm, has offices of the Minneapolis office.
in Minneapolis, Chicago and 10 other cities. The firm 's State whether in the following situations the individual
executive office and the managing partner are in Chicago. would be a "covered member" with respect to the 2001
Each office does all the work and issues the audit reports calendar year audit of Black & Co.
for the clients of that office. Black & Co. is an audit client
of the Minneapolis office. Corey, secretary to the Minneapolis office managing
State whether in the following situations the individual partner,
would be a "covered member" with respect to the 2001 (a) is a covered member
calendar year audit of Black & Co. (b) is not a covered member - Answer (b) is correct (Attest engagement team) does
not
Larson, a consulting services partner, in the Minneapolis include those performing routine clerical functions. Thus (Covered member (b)) does
office who has not done any work for Black & Co. not apply to nonprofessional people unless they are in a position where they can
(a) is a covered member influence the attest engagement. Corey, as a secretary, is thus not a covered
(b) is not a covered member - Answer (a) is correct. (Covered member (d)) includes member.
all
partners in the office where the lead attest engagement partner works. Since Porter is a partner in White & Co., CPAs. State whether in
Minneapolis does all the work for this client, the lead attest engagement partner has the following situations the person would be classified as
to be in Minneapolis. Larson is a partner in the Minneapolis office, and therefore he a member of Porter's immediate family.
is a covered member even though he never works on the Black & Co. engagement
Porter's dependent daughter who is away at college
Jones & Barnes, a public accounting firm, has offices (a) is classified as part of Porter's immediate
in Minneapolis, Chicago and 10 other cities. The firm 's family
executive office and the managing partner are in Chicago. (b) is not classified as part of Porter's immediate
Each office does all the work and issues the audit reports family - Answer (a) is correct. (Immediate family) says it includes
for the clients of that office. Black & Co. is an audit client dependents. Even though she is away at college she is still a dependent and thus
of the Minneapolis office. immediate family.
State whether in the following situations the individual
would be a "covered member" with respect to the 2001 Porter is a partner in White & Co., CPAs. State whether in
calendar year audit of Black & Co. the following situations the person would be classified as
a member of Porter's immediate family.
Olson, a professional staff person below the rank of
manager, who worked for two weeks in 2001 on a An elderly aunt of Porter's wife lives in a nursing
, CPA ETHICS EXAM(AICPA)WITH CPA ETHICS EXAM(AICPA)WITH
VERIFIED CORRECT ANSWERS VERIFIED CORRECT ANSWERS
UPDATED 2025 UPDATED 2025
home. Porter and his wife pay the monthly nursing on campus. Their support consists of paying for
home fees and any other expenses the aunt incurs. her tuition, books and supplies, board and room and
a small amount for spending money. She is one of
The aunt several students from foreign countries that members
(a) is classified as part of Porter's immediate of their church have sponsored at the college.
family
(b) is not classified as part of Porter's immediate She is not related to either Porter or his wife.
family - Answer (a) is correct. (Immediate family) says it includes (a) is classified as part of Porter's immediate
dependents. Since Porter pays all her expenses, she is a dependent and thus a family
member of his immediate family (b) is not classified as part of Porter's immediate
family - Answer (a) is correct. (Immediate family) says it includes
Porter is a partner in White & Co., CPAs. State whether in dependents. Since Porter pays all her expenses she is a dependent, and thus she is
the following situations the person would be classified as classified as immediate family.
a member of Porter's immediate family.
The AICPA Rules of the Code of Professional Conduct
Porter's non-dependent son who lives next door to apply to which group?
his father (a) All AICPA members.
(a) is classified as part of Porter's immediate (b) All CPAs who are licensed to practice.
family (c) All CPAs - Answer (a) is correct. (Applicability) section says that the
(b) is not classified as part of Porter's immediate rules apply to all AI CPA members.
family - Answer (b) is correct. (Immediate family) says it includes (b) is wrong because CPAs licensed to practice
one's spouse, spousal equivalent and dependents. who do not belong to the AI CPA are not subject
Porter's son is not dependent on him and is thus not considered immediate family. to AICPA rules.
(c) is also wrong because those CPAs not belonging to the AICPA are not subject to
Porter is a partner in White & Co., CPAs. State whether in AICPA
the following situations the person would be classified as rules.
a member of Porter's immediate family.
The Code of Professional Conduct says that with
Porter's wife who is self-employed and who annually respect to the acts of others:
earns twice as much as Porter earns (a) a member may be held responsible for compliance
(a) is classified as part of Porter's immediate with the rule by all persons associated
family with him in the practice of public accounting
(b) is not classified as part of Porter's immediate who the member has the authority or capacity
family - Answer (a) is correct. (Immediate family) says it includes to control.
spouses. Thus it does not matter how much she (b) a member has no responsibility for the acts of
makes, where she works, etc., Porter's wife is still anyone but himself.
classified as immediate family. (c) it is silent on the matter. - Answer (a) is correct. (Interpretation addressing the
Applicability of the AICPA Code of Professional Conduct) says a member may be
Porter is a partner in White & Co., CPAs. State whether in held responsible for the acts of others that he has the authority to control.
the following situations the person would be classified as
a member of Porter's immediate family. A member wishes to take an action but is told that
it would be against the rules in the Code of Professional
Porter and his wife have been for the last year and Conduct. His secretary then offers to take
are continuing this year to support a woman from the action saying to the member, "I will do it since
South America who is attending the local college. I am not a member of the AI CPA and their rules do
She is currently a sophomore and lives in a dormitory not apply to me." The member makes no comment
