Ann Archer serves on the audit committee of JKB Communications, Inc., a telecommunications start-up company. The company is currently a private company. One of the audit committee’s responsibilities is to evaluate the external auditor’s independence in performing the audit of the company’s financial statements. In conducting this year’s evaluation, Ann learned that JKB Communications’ external auditor also performed the following IT and e-commerce services for the company:
1. Installed JKB Communications’ information system hardware and software selected by JKB management.
2. Supervised JKB Communications’ personnel in the daily operation of the newly installed information system.
3. Customized a prepackaged payroll software application, based on options and specifications selected by management.
4. Trained JKB Communications’ employees on the use of the newly installed information system.
5. Determined which JKB Communications’ products would be offered for sale on the company’s Internet Web site.
6. Operated JKB Communications’ local area network for several months while the company searched for a replacement after the previous network manager left the company.
Required
Consider each of the preceding services separately. Evaluate whether the performance of each service violates the AICPA’s Code of Professional Conduct.
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