Subpart B —Duties and Restrictions Relating to Practice Before the Internal Revenue Service and Subpart C—Sanctions for Violation of the Regulations. Thus, they are generally held to the same standards of practice as persons who are eligible to practice before the IRS (Attorneys, CPAs, and EAs).
Pages 6 and 11
1-31. The AICPA’s Code of Professional Conduct provides a philosophical foundation upon which the Rules of Conduct are based. The Principles of the Code of Professional Conduct suggest that a CPA should strive for behavior that is above the minimal level of acceptable conduct set forth by the rules. The code was designed to provide the following:
Pages 16-17
1-32. Threats to complying with the Independence Rule include the following:
Page 18
1-33. In a tax practice the CPA may be requested to blindly follow the guidelines of a government agency or the demands of an audit client. This rule prohibits such blind obedience. The code specifically recognizes that conflicts of interest may arise in tax contexts, including providing tax or personal financial planning services for several members of a family whom the member knows to have opposing interests or when referring a personal financial planning or tax client to an insurance broker or other service provider who refers clients to the member under an exclusive arrangement.
Page 20
1-34. The General Standards Rule includes the following:
1. The CPA must be able to complete all professional services with professional competence.
2. The CPA must exercise due professional care in the performance of all professional services.
3. The CPA shall adequately plan and supervise the performance of all professional services.
4. The CPA must obtain sufficient relevant data to afford a reasonable basis for any conclusion or recommendation in connection with the performance of any professional services.
Competence encompasses not only technical subject matter but also knowledge of the profession’s standards and the ability to exercise sound judgment in applying the technical knowledge. At the same time, the code is clear that the member does not assume a responsibility for infallibility of knowledge or judgment
Page 21
1-35.
Pages 6 and 11
1-31. The AICPA’s Code of Professional Conduct provides a philosophical foundation upon which the Rules of Conduct are based. The Principles of the Code of Professional Conduct suggest that a CPA should strive for behavior that is above the minimal level of acceptable conduct set forth by the rules. The code was designed to provide the following:
- A comprehensive code of ethics and professional conduct;
- A guide for practitioners in answering complex questions; and
- Assurance to the public concerning the obligations and responsibilities of the accounting profession.
Pages 16-17
1-32. Threats to complying with the Independence Rule include the following:
- Members not acting with objectivity due to an adverse interest
- Advocacy threats
- Familiarity threats due to a long or close relationship with a client
- Management participation threats
- Self-interest threats
- Self-review threats
- Undue influence threats
Page 18
1-33. In a tax practice the CPA may be requested to blindly follow the guidelines of a government agency or the demands of an audit client. This rule prohibits such blind obedience. The code specifically recognizes that conflicts of interest may arise in tax contexts, including providing tax or personal financial planning services for several members of a family whom the member knows to have opposing interests or when referring a personal financial planning or tax client to an insurance broker or other service provider who refers clients to the member under an exclusive arrangement.
Page 20
1-34. The General Standards Rule includes the following:
1. The CPA must be able to complete all professional services with professional competence.
2. The CPA must exercise due professional care in the performance of all professional services.
3. The CPA shall adequately plan and supervise the performance of all professional services.
4. The CPA must obtain sufficient relevant data to afford a reasonable basis for any conclusion or recommendation in connection with the performance of any professional services.
Competence encompasses not only technical subject matter but also knowledge of the profession’s standards and the ability to exercise sound judgment in applying the technical knowledge. At the same time, the code is clear that the member does not assume a responsibility for infallibility of knowledge or judgment
Page 21
1-35.
- No violation
- 1.520.001: Commissions and Referral Fees
- No violation
- 1.600.001: Advertising and Other Forms of Solicitation
- 1.800.001: Form of Organization and Name Rule