| AICPA Professional Code of ConductThe following scenarios might constitute a violation of the AICPA’s Code of Professional Conduct. - Carrie Jones, CPA, performs various management services for The Perry Corporation including bookkeeping and preparing tax returns, but does not perform the audit function. One management service involved a needs assessment on computers and the identification of equipment to meet those needs. Jones recommended a product sold by a computer store, which has agreed to pay Jones a 10% commission if the Perry Company purchases it.
- Jonathan Keys, CPA, was overbooked for the next few months. When a prospective client asked if Keys would conduct the next year’s audit, he declined but referred them to Janet Rivera, CPA. Rivera paid Keys $5,000 for the referral.
- Katherine Porter, CPA, signed on to perform an inventory control study for a new client, River Forest Company. Once the study is complete, she recommends a new inventory control system. Currently, River Forest engages another audit firm to audit its financial statements. The financial arrangement is that River Forest will implement the new systems and over the next 10 years, they will pay Porter 60% of the savings in inventory costs.
- Thomas Caper, CPA, has served as the auditor for the Rover Corporation for many years. In addition, Caper has performed other services for the company. This year, the Chief Financial Officer has asked Caper to perform a major computer system evaluation.
- Due to the death of its CFO, an audit client had its external auditor, Sandra Richardson, CPA, perform the CFO’s job for two months until a replacement was hired.
Required: Knowing the AICPA Code of Professional Conduct, answer the following: - For each of the five scenarios, indicate which principle or rule would be violated, or if none would be violated.
- State why the rule would be violated.
- Explain if there is a way to avoid breaking the rule by doing something different in these examples.
Your written response paper should be 3-4 pages in length. Please type your assignment in a Word document and follow APA format, according to CSU Global Writing Center (Links to an external site.). Include a title page and reference page. Use two (2) outside academic sources other than the textbook, course materials, or other information provided as part of the course materials. Requirements: 3-4 Pages Not Counting Title and Reference Pages Answer preview
The aforementioned is a set of rules and regulations issued by the American Institute of CPAs that outlines their professional and ethical responsibilities (Jenkins et al., 2020). The code highlights the set standards for an auditor’s independence, objectivity, and integrity, their duties to their clients, and acts that taint accounting as a profession. The AICPA revises, drafts, and reissues the code of conduct annually every first of June (Jenkins et al., 2020). The code is put in place to ensure that the AICPA members act to promote due care, integrity, competence, and objectivity (Jenkins et al., 2020). It also demands that the AICPA members disclose conflicts of interest to the client, disclose any referral fees or commissions, and promote public interest in their service. (1039words)
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