In: Accounting
question8
(TCO C) Based upon the below four situations, explain your
position of why or why not the following circumstances would have
violated the professions ethical standards when you are a
practicing CPA.
1. Expressed an unmodified opinion on the current
year’s financial statements when fees for the prior year’s audit
were unpaid
2. Recommended a controller’s position
description with candidate specifications to an audit client
3. Purchased a CPA firm’s practice of monthly
write-ups for a percentage of fees to be received over a 3-year
period
4. Made arrangements with a financial institution
to collect notes issued by a client in payment of fees due for the
current year’s audit
Answer:
Given question,
(TCO C) Based upon the below four
situations, explain your position of why or why not the following
circumstances would have violated the professions ethical standards
when you are a practicing CPA.
1. Expressed an unmodified opinion on the current
year’s financial statements when fees for the prior year’s audit
were unpaid
2. Recommended a controller’s position
description with candidate specifications to an audit client
3. Purchased a CPA firm’s practice of monthly
write-ups for a percentage of fees to be received over a 3-year
period
4. Made arrangements with a financial institution
to collect notes issued by a client in payment of fees due for the
current year’s audit
Now answers :
Answer 1. is correct.
Reason :
Review expenses that are long past due interpretation of the qualities of a credit under direct lead 101. Autonomy is weakened whenever charged or unbilled expenses, or a note emerging from the expenses, for customer administrations rendered over 1 year before the current year's report date stay unpaid when the current year's report is issued. Notwithstanding, this decision does not have any significant bearing if the customer is in insolvency. In addition, long late charges don't block the CPA from performing administrations not requiring autonomy.
Answer 2. Incorrect.
Reason : Since a CIPA won't weaken freedom by prescribing work position depictions. Be that as it may, the CPA will be in infringement if (s) he in charge of screening applicants or settling on choices to procure.
Answer 3. Incorrect.
Reason : Since no proclamation restricts buy of an accounting firm for a level of charges.
Answer 4. Incorrect.
Reason : Since the AICPA has decided that this training does not damage the code.