For Each Situation (1-5),identify the Most Applicable AICPA Rule of Conduct

question 47

Short Answer

For each situation (1-5),identify the most applicable AICPA rule of conduct and whether there is a violation or no violation of the rule (A-F).One or more letters may not be used.
A. Rule 101: Independence; no violation
B. Rule 101: Independence; violation
C. Rule 102: Integrity and Objectivity; no violation
D. Rule 102: Integrity and Objectivity; violation
E. Rule 203: Accounting Principles; no violation
. Rule 203: Accounting Principles; violation
___ 1. Sterling Stevens, CPA, was auditing Global Services Company. Global Services used an accounting principle that was not in conformity with GAAP. Nevertheless, Stevens rendered a standard unqualified audit report.
___ 2. Christina Hall, CPA, provided expert testimony for a plaintiff. The defendant in the case was a client of Hall's.
___ 3. Sam Miller, CPA, owned 100 shares of Johnson Drilling, Inc., his audit client.
___ 4. Dewey Wise, CPA, obtained a loan from an insurance company using the cash value of the insurance policy as collateral. The loan is for less money than the cash value of the policy.
___ 5. Stella Steinbeck, CPA, was auditing Good Services Company. Good Services used an accounting principle that was not in conformity with GAAP. Good Services believed, and Steinbeck concurred, that using a generally accepted method would cause the financial statements to be misleading. Therefore, Steinbeck rendered a standard unqualified audit report.

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Definitions:

Further Action

Subsequent steps or measures to be taken following the current point in a process or plan.

Claims

Assertions or statements made, often in advertising or legal contexts, about the benefits, features, or rights associated with a product, service, or agreement.

Adjustment Requests

Formal or informal requests made to modify procedures, conditions, or environments to better fit individual or group needs.

Customer Fault

Situations where a customer's actions or decisions lead to a problem or error in the product or service experience.