Page 249 - JoFA_2022

LEARNING RESOURCE

Professional Ethics: The American Institute of
prohibited by laws or regulations. Documentation is Certified Public Accountants’ Comprehensive
encouraged but not required. Course
The interpretations do not apply to an engage-
Gain an understanding of professional ethics
ment or the provision of professional services by a in the accounting profession, the AICPA Code
member involving: of Professional Conduct, and related rules and
■ A litigation or investigation as defined in regulations that may apply to you and your
AICPA Statement on Standards for Forensic practice.
Services No. 1;
CPE SELF-STUDY
■ An engagement or service where the pri-
mary purpose is to identify, reach a conclusion
regarding, or otherwise respond to a known or For more information or to make a purchase, go to aicpa.org/cpe-learning
potential NOCLAR; or call the Institute at 888-777-7077.
■ An engagement or service pursuant to which
the protections set forth in Internal Revenue
Code Sec. 7525 or any comparable state or local
statutes apply; or
■ An engagement or service where compliance
with this interpretation would cause a violation
of law or regulation. or a combination of safeguards may need to be
applied.
UNPAID FEES The revised interpretation did not change the
The “Unpaid Fees” interpretation (ET exception for bankruptcy.
§1.230.010) is now a principles-based approach,
which better aligns with the unpaid fee rules ASSISTING CLIENTS WITH IMPLEMENTING
under the International Ethics Standards Board ACCOUNTING STANDARDS
for Accountants (IESBA) and the SEC. PEEC also approved the adoption of a new
The revised interpretation includes factors interpretation titled “Assisting Attest Clients With
to consider when evaluating whether threats to the Implementation of Accounting Standards.”
independence are at an acceptable level. Those When clients need help implementing a new
factors are: or existing accounting standard, they often ask
■ The significance of the fees to the covered their CPA for assistance. However, CPAs need to
member; ensure that such assistance does not impair their
■ How long the fees have been outstanding; independence when they provide attest services to
■ The attest client’s agreement to pay; and a client.
■ The covered member’s assessment of factors Although independence guidance already exists
affecting the ability of the attest client to pay. for practitioners when providing nonattest services,
Under the revised interpretation, threats PEEC adopted a new interpretation for practitio-
would be considered at an acceptable level when ners providing attest services. The interpretation
the unpaid fees are clearly insignificant and combines key elements from existing nonattest
relate to services provided less than one year services guidance in order to increase members’
prior to the date of the current attest report. understanding of and compliance with indepen-
However, if fees are significant and relate dence requirements.
to services provided more than one year prior The new interpretation states important points
to the date of the current attest report, then for practitioners to keep in mind with respect to
threats should be evaluated. If threats are not this issue, including:
at an acceptable level, the member may need ■ Not performing any management responsibili-
to implement safeguards in order to continue ties; and
with the engagement. The revised interpreta- ■ Ensuring that the individual at the attest client
tion provides examples of safeguards that may who is overseeing your assistance with the
be implemented to eliminate or reduce threats implementation of an accounting standard is
to an acceptable level. The practitioner may able to oversee the service and is capable of
determine that a single safeguard is sufficient to making all significant judgments and deci-
eliminate or reduce threats to an acceptable level, sions. This individual would also need to be

journalofaccountancy.com June 2022 | 33