In Reviewing Your Corporate Client's Tax Return for Last Year,you

question 4

Multiple Choice

In reviewing your corporate client's tax return for last year,you discovered that it overstated the beginning balance of its Patent account by $15 million.The client amortizes patents over a15-year period on a straight-line basis,so the company's pretax income was understated by $1 million last year.You informed your client over this error,and the client acknowledged that an error had been made.Nonetheless,your client insists that,for tax purposes,it intends to continue to amortize this patent balance in the same manner and for the same amounts as it did last year.You have a duty to:

• A) Inform the IRS about the client's refusal to make required corrections
• B) Not serve as the client's tax return preparer during the current year
• C) Not serve the client in any tax-related capacity, including as its tax preparer or tax adviser
• D) Continue to serve as the client's tax return preparer in accordance with your tax advocacy and confidentiality obligations

---

Definitions:

Zero Correlation

A statistical term indicating no relationship between two variables, meaning changes in one variable do not predict changes in the other.

Heel Height

The measurement from the bottom of the shoe sole to the bottom of the heel, indicating the elevation provided by the heel of a shoe.

Biased

Showing an unfair tendency to believe that some people, ideas, etc., are better than others, which can affect judgment and decision-making.

Representative

A person chosen or appointed to act or speak for another or others, often in decision-making processes.