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WorksheetsCode of Ethics for Professional Accountants
Total questions: 25
Worksheet time: 18mins
In order to achieve the objectives of the accountancy profession, professional accountants have to observe a number of prerequisites or fundamental principles. The fundamental principles include the following except
Independence
Professional behavior
Confidentiality
Objectivity
There are fundamental principles that the professional accountants has to observe when performing assurance engagements. The requirement of which principle is of particular importance in an assurance engagement in ensuring that the conclusion of the professional accountant has value to the intended user?
Objectivity
Confidentiality
Integrity
Professional competence
Occurs when a professional accountant promotes a position or opinion to the point that subsequent objectivity may be compromised
Advocacy threat
Self-interest threat
Self-review threat
Familiarity threat
Occurs when, by virtue of a close relationship, a professional accountant becomes too sympathetic to the client’s interests.
Self-interest threat
Self-review threat
Advocacy threat
Familiarity threat
A CPA shall not disclose confidential information obtained during an audit engagement in which one of the following situations?
When the security of the State so requires
With the consent of the client
In defense of himself when sued by the client
Under the rule against disclosing information
Occurs as a result of the financial and other interests of a professional accountant or of an immediate or close family member
Self-interest threat
Advocacy threat
Self-review threat
Familiarity threat
Occurs when a professional judgment needs to be re-evaluated by the professional accountant responsible for that judgment
Self-interest threat
Advocacy threat
Self-review threat
Familiarity threat
In their fiduciary role, the professional accountant owe their primary loyalty to:
The accounting profession
The general public
The client
Government regulatory agencies
Which of the following is a distinguishing mark of the accountancy profession?
A drive to excellence
Acceptance of the responsibility to act in the public interest
Professional objectivity
Professional skepticism
A professional accountant should comply with relevant laws and regulations and should avoid any action that discredits the profession. This is a fundamental principle of:
Objectivity
Professional competence and due care
Professional behavior
Integrity
Which of the following is not one of the fundamental principles of ethical conduct for professional accountants?
Integrity
Confidentiality
Loyalty
Professional competence and due care
Which fundamental principle is seriously threatened by an engagement that is compensated based on the net proceeds on loans received by the client from a commercial bank?
Objectivity
Professional behavior
Confidentiality
Integrity
“A professional accountant should be straight-forward and honest in all his professional and business relationships.” This description appropriately describes the fundamental principles of:
Integrity
Objectivity
Confidentiality
Professional behavior
Which of the following fundamental principles is compromised when a professional accountant is associated with reports or returns that are significantly misleading?
Integrity
Competence and due professional care
Objectivity
Professional behavior
If a professional accountant is billing an audit client a number of hours greater than those actually worked, which of the following fundamental principles is likely violated?
Objectivity
Integrity
Professional due care
Confidentiality
The requirement of which principle is of particular importance in an assurance engagement in ensuring that the conclusion of the professional accountant has value to the intended user?
Integrity
Confidentiality
Professional competence
Objectivity
A professional accountant is auditing Maiden Company and providing consulting services to Widow Company. Both clients are in the same industry. If the professional accountant uses specific information from Maiden’s audit to prepare a business plan for Widow, he will be violating the principle of:
Integrity
Professional behavior
Objectivity
Confidentiality
What kind of threat to noncompliance to fundamental principles is created if the professional fees due from a financial statement audit client remain unpaid for a long time?
Self-interest threat
Familiarity threat
Self-review threat
No threat is created
If the firm is involved in the preparation of accounting records or financial statements and those financial statements are subsequently the subject matter of an audit engagement of the firm, this will most likely create
Self-interest threat
Self-review threat
Intimidation threat
Familiarity threat
A director, an officer or an employee of the assurance client in a position to exert direct and significant influence over the subject matter of the assurance engagement has been a member of the assurance team or partner of the firm. This situation least likely create
Self-interest threat
Advocacy threat
Intimidation threat
Familiarity threat
A former officer, director or employee of the assurance client serves as a member of the assurance team. This situation will least likely create
Self-interest threat
Self-review threat
Intimidation threat
Familiarity threat
A CPA-lawyer, acting as a legal counsel to one of his audit client, is an example of
Self-interest threat
Advocacy threat
Self-review threat
Familiarity threat
A professional accountant has been the partner-in-charge of a particular audit client for the past eight years. This situation could result to the following threat to professional independence:
Self-review
Advocacy
Intimidation
Familiarity
If the firm performs a simultaneous services of auditing the client’s financial statements and bookkeeping services, the CPA may potentially face a
Self-interest threat
Intimidation threat
Self-review threat
Familiarity threat
There are fundamental principles that the professional accountants has to observe when performing assurance engagements. The requirement of which principle is of particular importance in an assurance engagement in ensuring that the conclusion of the professional accountant has value to the intended user?
Integrity
Confidentiality
Professional competence
Objectivity
