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Yaeger REG > Quiz 23-26 > Flashcards

Quiz 23-26 Flashcards

1
Q

Management will include an internal control report in its public audit report, your CPA firm reviews the management report to see if…

2) and the CPA firm…

A

it is in accordance with Attestation standards

2) reports on management’s report without charging additional
Fee

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2
Q

Management will include an internal control report in its public audit report. According to Section 404 of SOX, the CPA firm shall…

A

Attest to and report on assessment made by management

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3
Q

Can a CPA list his name and designation in the listings and bank stationary?

A

Yes

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4
Q

Work product doctrine is also know as…

A

Work product rule

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5
Q

Work product doctrine, what does it do? 2

A

1 Protects certain work to be admitted into a tax case

2 material in question may be shielded

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6
Q

A CPA who fraudulently performs an audit of a corporation’s financial statements will probably be liable to…

A

Any person who suffered a loss as result of the fraud

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7
Q

Under Ultramares, third parties who aren’t in privity of contract with accountants cannot…

2) But can…

A

Cannot sue for negligence

2) Can sue for gross negligence

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8
Q

Interpretation 101-5 of Rule 101 regarding independence states in essence that a loan to a limited partnership in which members have combined interest exceeding…

A

50% of total limited partnership interest is considered a loan
To those members

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9
Q

Section 206 does not allow a CPA firm employee to be a significantly placed employee (controller) of publicly traded firm for…

A

At least 1 year

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10
Q

If you’re offered a high level job by a publicly traded company and your CPA firm has not audited for 1 year…

A

You can take the job

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11
Q

Reason for 1 year cooling period between auditing at public accounting firm and taking a high level job at a public audit client?

A

Too high a potential conflict of interest

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12
Q

Because taxpayers are not versed in the language of tax, communication to clients should…

A

Should not contain too much detail

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13
Q

NASBA is tasked with…

A

Monitoring CPE programs for accuracy and content

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14
Q

State boards dictate the…

A

Rules and expectations of licensure within individual jurisdictions

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15
Q

A CPA’s Membership in a client social club, such as a country club is…

A

Basically only for social purposes and does not impair independence

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16
Q

What would impair a CPA’s independence if they were members of a client’s country club?

A

If they served on the club’s board of directors

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17
Q

The CPA owns an office building and the mortgage on the building is guaranteed by a client. This would…

A

Impair CPAs independence

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18
Q

If an audit failed to reveal employee fraud, the CPA’s adherence to…

A

GAAS may prevent liability

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19
Q

When a contract is assigned if the party fails to perform, the assignor would…

A

Be liable for performance

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20
Q

If the assignor enters into a contract with a 3rd party and assigns the rights of the contract to the other party (assignee). What are 3 circumstances that would make the assignor liable to the assignee?

A

1 assignor fails to perform contract

2 assignor releases 3rd party from contract

3 3rd party pays assignor

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21
Q

If the assignor enters into a contract with a 3rd party and assigns the rights of the contract to the other party (assignee). In what circumstance would the assignor no be liable to the assignee?

A

The assignee releases the third party

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22
Q

A single member entity is…

A

Disregarded as separate from their owner

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23
Q

An LLC with one member must submit IRS Form 8832 and elect to be…

A

A corporation or disregarded entity for tax purposes

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24
Q

Under the Securities Act of 1933, original offerings may be made…

A

Without registration

25
Under the 1933 act any Resales of offering may be subject...
Registration unless another exemption provision of the Act is Applicable
26
Under the '33 Act, For securities sold under a transaction exemption, Resales of the offering must be made under...2
1 a registration or 2 different exemption provision of the 1933 Act
27
Under the statute of limitations, in a case of a claim for breach of contract, the time period begins to run on the date... 2) this would also apply to the type of contract that is...
Date the contract is breached 2 construction contract
28
The 1933 act is only applicable to issuance of securities by...3
1 issuers 2 underwriters 3 dealers
29
If the sale or offer to sell securities is made by a person other than an issuer, underwriter or dealer the offering of securities will...
Be exempt from registration under the '33 Act
30
Control person
Someone having substantial power to influence the policies of management (ex. President of company)
31
The CPA may not associate his name with...
Direct mailers to non clients
32
Example of direct mailers to non clients
Estate planning firm composed of nonCPA owners who use high | Level of direct advertising
33
The CPA had ethical responsibilities to the public no matter in what...
Form or organization CPA participates
34
Apparent authority (AKA ostensible authority) is...
1 Power or understanding created or manifested in mind of third party 2 that agent may act on behalf of principal
35
Any limitation on apparent authority (in partnership) must be...
Communicated to third parties to be effective
36
Apparent authority is derived from the words and actions of the principal as... 2) It is not...
Viewed by the third party 2) not from express authority
37
Submitting a claim against the partnerships to arbitration requires...
Express authority from the principals
38
The Act of 1933 imposes various criminal and civil liability on...
The issuer if the omissions are material
39
Under the '33 Act, when omissions are intentional, this leaves...
Little defense for the defendant
40
Under the Act of 1934, SEC Rule 10b-5 specifically addresses...2
1 Fraud in issuance of securities and 2 and there associated materials whether registered under '33 Act or not
41
The key is, to be recognized under the 33 and 34 acts, the omission must be...
Material misrepresentation to the buyer
42
Specific performance forces performance of the contract when...
The goods are unique
43
Patents are unique, so the court would grant...
Remedy for contract for sale of patent
44
Upon dissolution of a partnership, each partner...
Continues to have apparent authority to make contracts
45
Upon dissolution of a partnership, each partner continues to have apparent authority to make contracts which would be binding upon the partnership until and unless both...
Both actual and constructive notice of dissolution is given by the partnership
46
For a purchaser of land to avoid a contract with the seller based on duress, it must be shown that...
The seller's improper threats actually induced the purchaser to assent the contract
47
Assent
Caused
48
Under Regulation A, an issuer is permitted to offer up to...2
1 $5 million of securities 2 including a maximum of $1.5 million
49
Under Regulation A, an issuer is permitted to offer up to $5 million of securities including a maximum of $1.5 million by...
Selling security holders in any 12 month period without registration With SEC
50
All offerings made under Registration A are...
Exempt from full registration under the '33 Act
51
Registration A filing is...
Less detailed than a formal registration
52
Under registration A, Not all intrastate offerings are...
Exempt from registration requirements
53
Example of numerous limitations on intrastate exception
At least 80% of issuer's assets must be located within state of Issuance
54
Stockbroker transactions and issuances under Reg D which involve resale are...
Not exempt from registration
55
Partnership's interest in specific partnership property is...
Not assignable to the partnership's individual creditors
56
A partnership's interest in specific partnership property is not...
Not subject to attachment by partner's individual creditors
57
A creditor may not obtain a...
Partner's interest in specific partnership property
58
A court will not award a partner's creditor with a...
Lien on specific partnership property

Yaeger REG (77 decks)

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