Practitioners repeatedly face situations that call for an immediate response: Is this a violation of the Code of Professional Conduct? The following situations, all related to independence, are posed to a practicing CPA, a member of the AICPA.

a. A practitioner is performing an attestation service for a privately owned corporation that includes the practitioner's cousin as a minority shareholder.

b. A commercial bank in which a practitioner carries two automobile loans has approached the practitioner to perform a financial statement audit.

c. A privately owned company, that has outsourced its information processing system to a public accounting firm, approaches the firm for a financial statement review engagement.

d. Although unrelated to the audit, an audit client has initiated litigation against a public accounting firm that is immaterial to the firm but material to the client's financial statements.

e. A practitioner has been engaged to compile the financial statements of a company owned partly by his children.

Required: 

Discuss whether in your judgment the situation violates Rule 101 of the Code of Professional Conduct or, in contrast, whether the situation is inconclusive.