Statements of Position

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Description

Ethics Ruling No. 64 was developed to illustrate that a member's limited partnership investment in a nonclient limited partnership controlled by the same promoter and/or general partner as the member's audit (or other services requiring independence) client limited partnership would cause an impairment of independence under certain circumstances. Ruling No. 65 has been developed to advise members that under rule 101 of the AICPA Code of Professional Ethics the appearance of a member's independence would be considered to be impaired with respect to the foundation because of a member's service on the board of directors of an organization receiving funding from the foundation. Ruling No. 66 provides that the use of the CPA designation by a member who is not in public practice in a manner to imply that the member is independent of the employer will be considered a knowing mispresentation of fact. In Interpretation 101-9, the Ethics Executive Committee is proposing to limit the exception to professional employees not participating in the engagement. The revision of Interpretation 201-2 covers prospective financial information prepared for internal use only, partial presentations of prospective financial information and other matters not covered by that standard. Proposed Interpretation 201-4 states that the engagements with respect to which the General Standards of Rule 201 apply include the engagements described in the Statement on Standards for Attestation Engagements, the Statement on Standards for Accountants' Services on Prospective Financial Information, and certain Statements on Auditing Standards, which, while not applicable to audits of financial statements, are applicable to other types of engagements. The Professional Ethics Executive Committee proposes to delete from the Ethics Code Interpretation 502-2, Subsection 5, Testimonials and Endorsements. The Professional Ethics Executive Committee has concluded that the use of an account broker to facilitate the sale or a purchase of a practice would not be proscribed by Rule 503.

ISBN

ed86-06-13bt

Publication Date

1986

Relational Format

Book

Keywords

Business ethics -- United States; Auditors -- Professional ethics -- Standards -- United States

Disciplines

Accounting | Taxation

Comments

Originally published by: American Institute of Certified Public Accountants; Copyright and permission to reprint held by: American Institute of Certified Public Accountants; Exposure draft (American Institute of Certified Public Accountants), 1986, June 13

Omnibus proposal of Professional Ethics Division interpretations and rulings ;Ruling No. 64 under ET section 191: Joint investment with a promoter and/or general partner;Joint investment with a promoter and/or general partner;Ruling No. 65 under ET section 191: Member as director of agency for which client raises funds;Member as director of agency for which client raises funds;Ruling no. 66 under ET section 191: Use of CPA designation by member not in public practice;Use of CPA designation by member not in public practice;Interpretation 101-9: Meaning of certain independence terminology and the effect of family relationships on independence;Meaning of certain independence terminology and the effect of family relationships on independence;Interpretation 201-2: Prospective financial information;Prospective financial information;Interpretation 201-4: Definition of the term engagement as used in Rule 201--General standards;Definition of the term engagement as used in Rule 201--General standards;Interpretation 502-2, Subsection 5: False, misleading or deceptive acts in advertising or solicitation;False, misleading or deceptive acts in advertising or solicitation;Ruling no. 181 under ET section 591: Sale of a practice--Purchase of accounts;Sale of a practice--Purchase of accounts

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