Rule 301 confidential client information

There has been no attempt to be specific about what constitutes a discreditable act; however, the AICPA bylaws Section 7. Rule prohibits contingent fees for all additional professional services when the CPA has performed an attestation engagement, which includes audits, reviews, and examinations of prospective financial information.

The purpose of Rule is to encourage a free flow of information from the client to the CPA; however, the rule makes it clear that the principle of confidentiality is not absolute. What constitutes a discreditable act is highly judgmental. In most states, and most federal courts, the CPA can be forced to testify in a Rule 301 confidential client information involving the client.

The confidentiality concept does not allow the client to omit information that is required by generally accepted accounting principles. Rule recognizes the confidentiality of client information, but makes it clear that the information does not constitute privileged communication.

Fees are not considered to be contingent if they are determined 1 by courts or other public authorities or 2 by judicial proceedings or governmental agencies in the case of tax matters.

Engagement fees should be determined by such factors as the number of hours required to perform the engagement, the type of personnel needed for the engagement, and the complexity of the engagement.

Rule is very broad. Rule - Confidential Client Information A member in public practice shall not disclose any confidential client information without the specific consent of the client.

An auditor should have access to a variety of information held by the client if the engagement is to be successful. The client will grant the auditor access to sensitive files and reports only if it can expect the auditor to hold the information in confidence.

In recent years, the concept of peer review has been accepted by the profession. It is basic to ethical conduct, and only through its observance can the profession expect to win the confidence of the public. Prepare an original or amended tax return or claim for a tax refund for a contingent fee for any client.

Thus, the rule recognizes that an auditor must respond to a subpoena or summons. Rule also prohibits the CPA from charging a contingent fee to prepare an original or amended tax return or claim for a refund.

A contingent fee is based on an arrangement whereby the client is not required to pay the CPA unless a specified finding or result is attained.

While independence is not an issue in performing tax services, the AICPA takes the position that it would be unprofessional to charge a fee, for example, based on the amount of refund that may be claimed on the tax return.

On the other hand, SAS does note that an auditor ordinarily should not make available information that is not required to be disclosed to comply with GAAP. The period of prohibition includes the date covered by the financial statements and the period during which the attestation service and compilation service, as described above is performed.

Solely for the purposes of this rule, fees are not regarded as being contingent if fixed by courts or other public authorities, or, in tax matters, if determined based on the results of judicial proceedings or the findings of governmental agencies.

Except as stated in the next sentence, a contingent fee is a fee established for the performance of any service pursuant to an arrangement in which no fee will be charged unless a specified finding or result is attained, or in which the amount of the fee is otherwise dependent upon the finding or result of such service.

BeforeRule prohibited contingent fees for all professional engagements with the exception of certain fees fixed by the judicial or quasi-judicial process.

InThe Federal Trade Commission FTC challenged the position of the profession concerning contingent fees on the basis of restraint of trade. Also, the CPA may not perform any services for a client on a contingent fee basis when the CPA has performed a compilation engagement if the compilation report is expected to be used by a third party and does not disclose that the CPA is not independent with respect to the client.

Rule - Acts Discreditable A member shall not commit an act discreditable to the profession. Rule - Contingent Fees A member in public practice shall not: SAS Adequacy of Disclosure in Financial Statements reinforces this position by stating that if a client omits information that is required by GAAP, a qualified or adverse opinion must be expressed.a Rule Confidential Client Information b Rule Accounting Principles from AUDITING AC at Kaplan University, Davenport93%(14).

Rule of the American Institute of Certified Public Accountants’ professional standards states that a member CPA “shall not disclose any confidential client information without the specific consent of the client.” Auditing documentation should not be made available to outside parties.

Rule of the American Institute of Certified Public Accountants’ professional standards states that a member CPA “shall not disclose any confidential client information without the specific consent of the client.”.

01 Rule —Confidential client information. A member in public practice shall not disclose any confidential client information without the specific consent of the client.

This rule shall not be construed (1) to relieve a member of his or her professional obligations under rules Rule - Confidential Client Information. A member in public practice shall not disclose any confidential client information without the specific consent of the client.

Rule confidential client information; no violation rule does not affect a CPA's obligation to comply with rules (compliance with standards) and (accounting principles).* Priscilla Hudson, CPA, a partner in Hudson and Danhoffer, CPAs, holds the position of honorary director for the Friends of the Symphony Orchestra, a firm audit client.

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Rule 301 confidential client information
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