Code Of Conduct

Front 1

can a CPA advocate on behalf of their attest/audit clients?

Back 1

NO

Front 2

do clients have the right to veto outsourcing of administrative duties?

Back 2

NO

Front 3

when can a CPA receive contingent/commission/referral fees?

Back 3

for private letter rulings and tax clients;

-NEVER for an audit client, regardless of what the commission is for

Front 4

attest firms must be majority owned...

Back 4

by CPAs

Front 5

is a partner in the same office who has never done work for the client a covered member?

Back 5

YES

Front 6

for immediate family and close relatives, what conditions must be met to avoid independence issues?

Back 6

interest must be both indirect and immaterial

Front 7

what is considered as having material interest?

Back 7

-shares in a mutual fund

-<5% of outstanding shares in undiversified fund

Front 8

what is NOT considered to cause a material interest issue?

Back 8

-<5% of outstanding shares in a diversified fund

Front 9

what is included as causing one to have a Direct Interest?

Back 9

-general partner's interest

-mutual fund

-active trustee

-grantor of a trust

-participation in employee benefit plan

-capital lease

-blind trust

Front 10

what is considered to cause Indirect Interest?

Back 10

-limited partner's interest

-insurance policies (unless includes investment option)

-brokerage accounts

-bank accounts (unless going under and material)

Front 11

define Direct Financial Interest

Back 11

interest owned directly, under their control, or when they have a say in investment decisions

Front 12

employment-related Independence Impairment:

Back 12

-promoter of client's securities

-member of client's board

-on client's general counsel

Front 13

employment-related NO Independence Impairment

Back 13

-advisor to board of trustees

-honorary partner of trustee

Front 14

to whom does the 1-year cooling-off period apply?

Back 14

only to upper level positions

Front 15

what are the situations in which a Gift doesn't cause an issue?

Back 15

-another partner in the office

-gifts that are "clearly insignificant"

-entertainment that is "reasonable in the circumstances"

Front 16

2 times when CPA can disclose confidential client info without client's consent

Back 16

1. valid court order

2. state CPA quality review board

Front 17

do members in business have to worry about independence rules?

Back 17

NO

Front 18

for whom may an accountant perform actuarial services?

Back 18

private companies & public companies that it does not audit

Front 19

PCAOB: auditor cannot perform which services for an audit client?

Back 19

-bookkeeping

-financial systems & design implementation

-appraisals

-contribution-in-kind reports

-actuarial services

-IA outsourcing

-management/HR

-broker/dealer

-investment advisor

-legal services

Front 20

after how many years must the lead auditor rotate?

Back 20

5 years on, 5 years off