Statements of Position

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Description

The Professional Ethics Executive Committee proposes to revise Interpretation 101-5 in order to provide guidance to members with respect to the terms "loans" and "financial institution" as used in Rule 101. Investment by a member's IRA or Keogh plan in a client would be considered to impair that member's independence with respect to that client. The member's independence would not be considered impaired with respect to the financial institution provided that the checking account, savings accounts, certificates of deposit, and money market account are fully insured. The mere servicing of a member's loan by a client financial institution would not impair the member's independence with respect to the client. A member's independence would be considered impaired whether or not the member's direct financial interest in the client is placed in a blind trust. Ruling No. 62 under ET section 191 provides guidance for joint investments when both the member and client are limited partners. If a member has been engaged to prepare a tax return and the client or the member terminates the engagement before the tax return is delivered to the client, the member's responsibility is to return only those records originally provided. The committee proposed that Interpretation 201, "Shopping for Accounting or Auditing Standards," be withdrawn.

ISBN

ed87-05-25t

Publication Date

1987

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), 1987, May 25

Omnibus proposal of Professional Ethics Division interpretations and rulings ;Revision to interpretation 101-5 under rule of conduct 101,

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