Professional Responsibilities

Question 1

The 6 Articlees of the Principles section of the AICPA Code of Professional Conduct

Answer 1

1. Responsibilities
2. The public interest
3. integrity
4. . Objectivity and indepndence
5. due care
6. scope and nature of services

Question 2

A AICPA Code principle that is measured in terms of what is right and just and requires a member to observe principles of objectivity, indepndence and due care

Answer 2

Integrity

Question 3

Level of indpendence necessary when providing auditing or attestation services

Answer 3

Independence in fact and appearance

Question 4

A threat to independence that results from reviewing evidence that results from the member’s own work

Answer 4

Self-review threat

Question 5

A type of indepndence threat that results from actions promoting the client’s interest or position

Answer 5

Advocacy threat

Question 6

A threat to indepndence that results from actions or interests between teh member and the client that are in opposition (i.e. litiation between the client and the member)

Answer 6

Adverse interest threat

Question 7

A threat to independence tha results from members having a close or longstanding relationship with the client or knowing individuals or entiteis who performed nonattest services for the client

Answer 7

Familiarity threat

Question 8

A threat to indepndence that results from attempts by a client’s mamnagment to coernce the member or exercise excessive influence over the member

Answer 8

Undue influence threat

Question 9

A threat to independence that results form a potential benefit to a member from a financial interset in, or some financial interest iwth, an attest client

Answer 9

Financial self-interest threat

Question 10

A threat to independence that results from a member from assuming the role of managmeent or performing management functions for hte attest client

Answer 10

Management participation threat

Question 11

AICPA rule stating that a member in public practice shall be independent in the performance of professional services as required by standards promulgated by designated bodes

Answer 11

Rule 101 Independence

Question 12

An individual that would be considred a covered member because they evaluate the performance/recommend compensation of the attest engagement partner, directly supervies the partner, consults with the team, or oversees quality control

Answer 12

An individaul in a position to influence the attest engagement

Question 13

Begins when a member either signs an initial engagement letter or other agreement to perform attest services, or to perform an attest engagment for a client (whichever is earlier) and ends with the formal or informal notification of hte termination of the professional relationship

Answer 13

Period of the professional engagement

Question 14

A position in which an individual has primary responsibility for significatn accounting functions, for the preparation of hte financial statements, or has the ability to eercise influence over the contents of the financial statements

Answer 14

Key position

Question 15

A parent, sibling, or nondepndent child

Answer 15

close relative

Question 16

A spouse, spousal equivalent, or dependent (wheter or not related)

Answer 16

Immediate family

Question 17

An ownership interest in an equity or a debt security that is directly owned by an individual or entity, under the control of the individual or entity, or is beneficially owned through nan investment vehicle

Answer 17

Direct financial interest

Question 18

A registered public accounting firm must comply with these 2 sets of rules when auditing an issuer

Answer 18

PCAOB rules and standards and rules and regulations of SEC under federal securities laws

Question 19

A tax transaction that is offered to a client under conditions of confidentiality and for which teh client pays the public accounting firm a fee

Answer 19

Confidential transaction–audit firm is not independent if perform this for an issuer audit client

Question 20

Designated body for accoutning principles for businesses

Answer 20

FASB

Question 21

Designated body for accounting principles for federal governmental entities

Answer 21

FASAB (Federal Accounting Standards Advisory Board)

Question 22

Designated body for accounting principles for state and locla governmental entities

Answer 22

GASB (Governmental Accounting Standards Board)

Question 23

Designated body for audidting, attestation, quality control, ethics, and independence statndards for companies covered by SOX

Answer 23

PCAOB

Question 24

designated body for international accounting standards

Answer 24

IASB

Question 25

Sources of GAAP

Answer 25

1. FASB
2. FASAB
3. GASB
4. IASB

Question 26

An auditing service in which the practicioner expresses a conclusion about hte reliability of a written assertion that is the responsibility of another party

Answer 26

Attest services

Question 27

An audit service in whichthe practioner develops the findings, conclusions and recommendations presented, generally only for the use and benefit of the client

Answer 27

Consulting services

Question 28

A CPA holding out as a CPA while engaged in the performance of a consulting service for a client

Answer 28

Consulting services practioner

Question 29

Professional services that employ the practicioner’s technical skills, education, observations, experiences, and knowledge of the consulting process

Answer 29

Consulting services

Question 30

A type of sonsulting service that provides counsel in a short time frame, based mostly, if not entirely, on existing personal knowledge about hte client

Answer 30

Consultation

Question 31

A stype of consulting service in which the CPA develops findings, conclusions, and recommendations for client consideration and decision making

Answer 31

Advisory services

Question 32

A type of consulting service in which the CPA places an action plan into effect

Answer 32

Implementation services

Question 33

A type of consulting service that provides services related to a specfic client transaction, generally with a third party

Answer 33

Transaction services

Question 34

A consulting service that provides appropriate staff and possibly other support to perform tasks specified by the client

Answer 34

Staff and other support services

Question 35

A type of consulting service that provides clients wtih a product and associated support services

Answer 35

Product services

Question 36

Authoritative literature for consulting services

Answer 36

Statements on Standards for Consulting Services (SSCS)

Question 37

Tbe authoritative body designed to promulgate attestation standards

Answer 37

Auditing Standards Board

Question 38

Section of SOX that in essence led to CPA reporting on client internal control

Answer 38

Section 404

Question 39

Section of SOX that makes it unlawful for any officer/director to take any action to fraudulently influence, coerce, manipulate, etc. any public accountat engaged in the performance of hte audit

Answer 39

Section 303

Question 40

A standard-setting body withinthe International Federation o Accountants that issues ethical standards for accuntatns throughout the world; has 3 parts:
1. Part-A–applies to all professional accountnats
Part B–applies only to public practice
Part C–applies only to accountatns inb usiness

Answer 40

International Ethics Standards Board for Accountants (IESBA)

Question 41

A worldwide organization of 160 national accounting bodies that debeloped the nternational auditing standards issued as a series of statements referred to as International Standards on Auditing

Answer 41

International Auditing and Assurance Standards Board (IAASB) of the International Federation of Accountants (IFAC)

Question 42

Developed by the International Accounting Standards Board (IASB) to regulate international auditing standards and are generally more principle-based than GAAP, leaving room for more judgment

Answer 42

International Financial Reporting Standards (IFRS)

Question 43

The prupose of this regulatory body is to protect investors, maintain fair, oderly, and efficient markets, and facilitate capital formation; has the auotirty to establish standards

Answer 43

Securities and Exchange Commission (SEC)

Question 44

A regulatory body whose mission is to support Congress in meeting its constitutional responsibilites and to help improve the performance and sure hte accountability of hte federal government

Answer 44

Government Accountability Office (GAO)

Question 45

Regulatory body whose mission is to foster and promote the welfare of job seekers, wage earners, and retirees of the United States

Answer 45

Department of labor