Chapter 29: Code of professional conduct
* What guidance is provided to help AICPA members follow the Code Of Professional Conduct?
Provides general guidance on professional responsibilities, the public interest, integrity, objectivity and independence, due care, and the scope and nature of services without establishing specific standards. Nevertheless, every practitioner should read them. An understanding of the difference between independence and objectivity is important particularly when consulting services are being provided to attest service clients.
* List three suggestions given by the AICPA.
1.Sources of a Code of Conduct in Tax Practice
Underlying all of the specific rules, laws, and regulations governing a CPA’s provision of tax services is a basic code of conduct that defines what it means to act as a professional. A professional firm can look to a number of sources for key principles of ethical conduct to emphasize in its practice.
2. Analyzing Ethical Situations
Discussions of case studies that apply ethical standards to common workplace situations can be particularly effective, since professional conduct and ethical behavior depend on the good judgment of individuals in what are often complex, challenging, and ambiguous real-life situations.
3. Choosing Associates and Clients
Associating with ethical people can strengthen an ethical culture. In making employment decisions, the firm should seek to identify candidates with the characteristics the firm values as part of its ethical standards, such as integrity, diligence, dependability, and sincerity.
* Explain how the guidelines might help you in your professional behavior.
These guidelines might help me in the professional field by keeping thing straight with a particular client. It could help by knowing how a CPA would have to present him or her self in case of a case.
Keywords and Reference
Words: Suggestions, Code of Conduct, Ethics, Case, AICPA
Critical Thinking Questions
1. What resources does the AICPA offer to help members negotiate ethical dilemmas and to learn more about the Code of Professional Conduct and how it is applied? Which of these resources do you think would be the most helpful to member CPAs? Why?
The AICPA offers a set of rules to follow in the code of conduct, that were created to deal with any type of dispute, threat, etc. If the rules are followed the threats, or disputes may be reduced or eliminated. In my opinion Rules 101,102, 201, 203, and 301 are the most helpful, because they cover all of the standards in a professional environment.
2. In regard to CPA's independence, why do you think the SEC and the AICPA prohibit a CPA from owning shares of a client's stock?
In my opinion, the SEC and the AICPA prohibits a CPA from owning shares of a clients stock, to avoid assuming management responsibilities when providing nonattest services. If the client can’t oversee the procedure, the CPA can’t assume the responsibility, because a management participation threat created would be so significant that no safeguards could reduce the threat to an acceptable level. It is not possible to specify every activity that is a management responsibility. However, management responsibilities involve leading and directing an entity, including making significant decisions regarding the acquisition, deployment, and control of human, financial, physical, and intangible resources.
3. If you worked as a CPA and encountered an ethical dilemma in the workplace, what steps might you take to research the situation and find an appropriate course of action?
If I worked as a CPA, the first thing I would do is locate the on going threat and the go to the code of conduct, to see if there is a safeguard, to try to overcome the ongoing treat.
* What types of violations were investigated?
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