MIPPS Non independence rules-conflict of interest etc Flashcards
Understand and be able to apply the Code of Professional Conduct’s rules regarding:
General conflicts of interest.
Members serving on corporate boards.
Gifts and entertainment (which can pose a threat to member integrity and objectivity).
k
subordinate in judgement-conflict with a superior over how to record potential earnings (or some other issue) they are not to simply accept the superior’s judgement and it’s your belief that is wrong. what do you do?
evaluate the significance of the threat if you do it his way, applicable laws, regulations will be violated
if the threat is not significant then nothing further needs to be done
if there really is a threat then you need to talk to the superior. if the superior is still being stubborn then you need to go over his head and go to his or her superior.
if all of that still doesn’t work then you will have to do a few things.
get legal advise
document everything
determine if the organization internal policies and procedures have any additional requirements for reporting difference of opinion
determine if she is responsible for consulting 3rd parties such as regulatory authorities
if you conclude that it can’t be reduced to a comfortable level then consider leaving firm and take appropriate steps to eliminate exposure to subordination judgement.
subordinate in judgement-conflict with a superior over how to record potential earnings (or some other issue) they are not to simply accept the superior’s judgement and it’s your belief that is wrong. what do you do?
evaluate the significance of the threat if you do it his way, applicable laws, regulations will be violated
if the threat is not significant then nothing further needs to be done
if there really is a threat then you need to talk to the superior. if the superior is still being stubborn then you need to go over his head and go to his or her superior.
MIPPs may not _____for their attest clients
advocate
if you are doing tax or advisory work you may advocate for their clients
use of 3rd party service service provider (tsps) standards
outsourcing to TSPs may affect objectivity. if outsourceing to for administrative or clerical work then it’s no problem. but if doing professional services the client must be notified in writing before any confidential info is provided. client may object. you got two choices. dont oursource or turn down client
General standards and acc principles standards
professional competance
undertake only services able to perform with competance and may need to turn down work.
due professional care
planning and supervision
sufficient relevant data-must obtain proper good data. don’t make shit up
competance
member or member staff possesses appropriate technical qualifications and member can supervise and evaluate the quality of work performed
use of tsp
members must adequately plan and supervise TSPs services and obtain the data neccessary to evaluate them.
departure from gaap is appropriate if you can demonstarte
that following gaap is misleading
describe departure-here is what we did, here is gaap
describe reason why compliance with gaap would result in a misleading statement
reasons for departure or reasons that justify departure
new legislation
evolution of new form of business gaap is not caught up with
reasons that don’t justify departure
an unusual degree of materiality
conflicting industry practice-ex no one else was following it so we didnt either
it’s permitted when
contractual arrangement says a different approach
in a different country and other framework is used
or special purpose frameworks
discreditable acts
failure to file a tax return or pay a tax lia
negligence in prep of f/s
material departure
failure to follow standards
improper use of imdemnification-accounts must be liable for their errors
disclosure of confidential info obtained from employment or charitable activities
false advertising-misleading
improper use of cpa credential
records request-removing client files after termination
use of confidential info with out consent. ex a possible future client seeks consultation and you know confidential info. even though they were never your client you must stay confidential.
4 types of records
client provided records- ex customer receipts and invoices etc
member prepared records
je, supporting schedules etc
members work products-things we were prepared to make ex tax return
working papers-records we did
what if client wants client provided records
member prepared records
work products
working papers
must give them back if they want them
aicpa-says must return if paid
if not paid dont have to give back
may be witheld if havent been paid or work is incomplete and afraid they are going to file with sec or irs, or holdiing due to unresulved issues. threatened or o/s litigation
our property.
sometimes state laws are more demanding. if these state laws say you must give them back then
give them back
records should be turned over within (if need be)
45 days
