1. Accountant 6 is an audit manager. My client, a privately held company, admires my work, and they have offered me a job to start when the engagement is over. What should I do?

• Explain what you understand to be the "threat." (For example, "It seems that this situation can impair independence.")
• Clearly state any assumptions you are making. (For example, you might say, "I assume the client is not a publicly held company.")
• Explain alternative assumptions if they lead to different answers. (For example, you might say, "If the company is publicly held, you may not perform that service as that is prohibited by the SEC.")
• Properly reference the specific section of the AICPA Code of Professional Conduct that answers this question.
• Address any ethical virtue or issue you see in the question. (For example, going along with the client might conflict with the virtue of Trustworthiness). 

2. Accountant Seven is an audit manager of a distressed client. Our client is in true financial trouble and wants our firm to lend them money. Can we?

• Explain what you understand to be the "threat." (For example, "It seems that this situation can impair independence.")
• Clearly state any assumptions you are making. (For example, you might say, "I assume the client is not a publicly held company.")
• Explain alternative assumptions if they lead to different answers. (For example, you might say, "If the company is publicly held, you may not perform that service as that is prohibited by the SEC.")
• Properly reference the specific section of the AICPA Code of Professional Conduct that answers this question.
• Address any ethical virtue or issue you see in the question. (For example, going along with the client might conflict with the virtue of Trustworthiness.)

 

3. Accountant eight is a staff accountant. The client wants to give me a key to the office so I can come in early and get started. There are a lot of documents in the office, and many assets are stored in the office as well. Should I take the key?

• Explain what you understand to be the "threat." (For example, "It seems that this situation can impair independence.")
• Clearly state any assumptions you are making. (For example, you might say, "I assume the client is not a publicly held company.")
• Explain alternative assumptions if they lead to different answers. (For example, you might say, "If the company is publicly held, you may not perform that service as that is prohibited by the SEC.")
• Properly reference the specific section of the AICPA Code of Professional Conduct that answers this question.
• Address any ethical virtue or issue you see in the question. (For example, going along with the client might conflict with the virtue of Trustworthiness.)

4. Accountant Nine is the partner in charge of development. An audit client wants us to take over the signing of their check as a part of our audit. Can we do that? 

• Explain what you understand to be the "threat." (For example, "It seems that this situation can impair independence.")
• Clearly state any assumptions you are making. (For example, you might say, "I assume the client is not a publicly held company.")
• Explain alternative assumptions if they lead to different answers. (For example, you might say, "If the company is publicly held, you may not perform that service as that is prohibited by the SEC.")
• Properly reference the specific section of the AICPA Code of Professional Conduct that answers this question.
• Address any ethical virtue or issue you see in the question. (For example, going along with the client might conflict with the virtue of Trustworthiness.)

5. Accountant 10 is the tax department manager; he is an attorney. An audit client engages us to complete their tax return. Will that be okay? Should our tax department take the job?

• Explain what you understand to be the "threat." (For example, "It seems that this situation can impair independence.")
• Clearly state any assumptions you are making. (For example, you might say, "I assume the client is not a publicly held company.")
• Explain alternative assumptions if they lead to different answers. (For example, you might say, "If the company is publicly held, you may not perform that service as that is prohibited by the SEC."
• Properly reference the specific section of the AICPA Code of Professional Conduct. 

Answer rating: 100% (QA)

Lets address each scenario in turn 1 Accountant 6 Threat The threat in this situation is a potential impairment of independence as accepting a job offer from a client can compromise objectivity and im... View the full answer