CPA CPA Ethics & Professional Responsibility

Question 1

Under the AICPA Code of Professional Conduct, which principle requires a CPA to be straightforward and honest in all professional relationships?

Accepted Answer

Integrity

Answer

The integrity principle requires CPAs to be honest, candid, and free from deception in all professional and business relationships.

Question 2

A CPA discovers during an audit that a client has committed an immaterial illegal act. What is the CPA's primary obligation?

Accepted Answer

Inform the client's management or those charged with governance

Answer

For immaterial illegal acts, the CPA should inform the appropriate level of client management or those charged with governance so corrective action can be taken.

Question 3

Which threat to CPA independence occurs when a CPA audits their own firm's previous work?

Accepted Answer

Self-review threat

Answer

A self-review threat arises when a CPA audits or evaluates work that they or their firm previously performed, compromising objectivity.

Question 4

Under the AICPA rules, which of the following would NOT impair auditor independence?

Accepted Answer

Performing bookkeeping services for a non-attest client

Answer

Providing bookkeeping services for a non-attest client does not impair independence since independence is only required for attest engagements.

Question 5

The concept of 'due professional care' in auditing requires auditors to:

Accepted Answer

Exercise the skill and diligence of a competent auditor

Answer

Due professional care requires auditors to apply the competence and diligence expected of a reasonably skilled professional, without guaranteeing perfection.

(CPA) Certified Practicing Accountant Practice Test

(CPA) Certified Practicing Accountant Practice Test

CPA CPA Ethics & Professional Responsibility