A6/M7 the AICPA code of professional conduct

Question 1

what is the AICPA code of professional conduct?

Answer 1

the aicpa code of professional conduct governs any service that a member of the aicpa performs

Question 2

what are the exception rules regarding auditor receives a financial interest (shares of client’s stocks) due to unexpected event such as inheritance?

Answer 2

• the financial interest was unsolicited
• the auditor disposes of the interest as soon as practicable but no later than 30 days after the auditor becomes aware of it and has the right to dispose of the interest

Question 3

what is exercising due care?

Answer 3

• Due care requires that the firm and members of the engagement team observe the profession’s technical and ethical standards.
• exercising due care when consulting with experts or referral when a professional engagement exceeds the CPA’s personal competence
• critically review the judgment exercised by those assisting in the audit

Question 4

what is contingent fees?

Answer 4

• are based on a specific finding or result and prohibited in all attest services. ex: cpa would charge a different service fees if the cpa finds sever or import audit results
• contingent fees are permitted under a legal proceeding or ruling because these services is fixed by the legal jurisdiction

Question 5

what are the general standards rule?

Answer 5

1. professional competence
2. due professional care
3. planning and supervision
4. sufficient relevant data