Test Your Knowledge of Professional Ethics

By Finkston, Herbert | Journal of Accountancy, September 1991 | Go to article overview

Test Your Knowledge of Professional Ethics


Finkston, Herbert, Journal of Accountancy


*This quiz is based on AICPA professional ethics division staff responses to written inquiries from members. It is not a pronouncement of the professional ethics executive committee nor does it purport to set forth an official position of the AICPA. In addition, the questions and answers do not address the requirements of other regulatory bodies, such as the state boards of accountancy and the Securities and Exchange Commission, whose positions may differ from those of the AICPA.

Edited by HERBERT FINKSTON, director of the AICPA professional ethics division.

TEST YOUR KNOWLEDGE OF PROFESSIONAL ETHICS

From time to time the Journal publishes questions on ethics topics that have been raised by members of the American Institute of CPAs. This group deals with interpretations under Conduct Rules 101-Independence, 505-Form of Practice and Name and 301-Confidential Client Information. * C ONCERNING INDEPENDENCE

1 . The brother of a partner's spouse is the 50% owner of a prospective audit client of the partner's firm. Would the firm be considered independent with respect to the prospective client?

Yes No

2. A member's client is a 30% owner of a corporation. The investment is material to the client. May the member invest in the corporation without impairing independence with respect to the client?

Yes No

3. The stepbrother of a manager in a firm is the president of a prospective audit client. The stepbrothers have a common father and, therefore, carry the same name. State probate law dictates that individuals with one common parent are treated as full blood siblings. Would the stepbrother's job with the prospective client impair firm independence?

Yes No

4. A partner of a firm is a part-time faculty member of a university. The partner has been asked to audit a local foundation whose sole function is to provide scholarships to students attending the university. All scholarship applications are received from the students. Additionally, the university and the foundation do not have any common directors or employees. Would the partner's independence be considered impaired with respect to the foundation?

Yes No

5. A staff accountant in a firm has an immaterial direct financial interest in a prospective audit client of the firm. Would the firm be precluded from expressing an opinion on the client's financial statements due to a lack of independence?

Yes No

6. A partner of a firm resigned from a corporation's board of directors as of March 31, 1989. In February 1990, the firm was asked to perform an audit of the corporation's financial statements for the fiscal year ended December 31, 1989. Would the firm be considered to be independent with respect to the corporation?

Yes No

FORM OF PRACTICE AND NAME

7. A member's firm is currently named Jones, Smith & Company. The partners wish to change the firm name to one that reflects the services offered, for example, Litigation Support Consultants. Would the proposed firm name be permissible under Rule 505?

Yes No

8. A member is establishing an accounting practice as a sole practitioner. Would it be permissible for the firm's name to include "and Company"?

Yes No

CONFIDENTIAL CLIENT INFORMATION

9. A regulatory agency has asked a member to supply confidential client information in connection with an investigation of the client. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Test Your Knowledge of Professional Ethics
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.