Question

Which is most likely a violation of the AICPA Code of Professional Conduct?

A member firm buys computer time at wholesale prices from another CPA firm and sells it at retail prices to clients.

A member begins a public accounting firm with the trade name “Pay Less Tax Service."

A member forms a partnership for the practice of public accounting with nonCPAs.

A member firm's name is imprinted on a tax booklet prepared by an outside author who is clearly identified.

Answer 1

The four parts of the AICPA Code of Professional Conduct are principles, rules of conduct, interpretations of the rules of conduct and ethical rulings. Of these parts, only the rules of conduct are enforceable.

A member firm buys computer time at wholesale prices from another CPA firm and sells it at retail prices to clients is most likely a violation of the AICPA Code of Professional Conduct because it violates basic principles of integrity, scope and nature of services of CPAs. Although it is not enforceable because only if the rule of conduct is violated enforcement is possible.

CPAs are meant for public service with due integrity and responsibilities. Therefore any activity which does not comes under their scope of work must be avoided.