The AICPA Professional Ethics Executive Committee (PEEC) released for public comment two exposure drafts to align the Code of Professional Conduct with international standards and to clarify members' ethical responsibilities when allowable collaboration for CPE crosses the line into cheating.
International convergence
As a member body of the International Federation of Accountants (IFAC), the AICPA has a responsibility to maintain alignment between professional standards and those of applicable international standards-setting bodies.
PEEC's ongoing project to substantially converge the AICPA Code with that of the International Ethics Standards Board for Accountants (IESBA) sometimes results in new or revised interpretations of the rules. Other times, convergence is as simple as changes to definitions. This round of proposed changes has both new and revised interpretations.
Fees and auditor independence
IESBA's fees project sought to clarify the fees and pricing practices of professional accountants and ensure that they were consistent with the fundamental principles of its code, auditor independence in particular. IESBA adopted related changes to its code in 2021, and these became effective in December 2022.
Shortly thereafter, PEEC undertook its convergence project and is proposing two new interpretations of the "Independence Rule."
The "Determining Fees for an Attest Engagement" interpretation (ET §1.230.030) seeks to ensure that fee determination for an attest client is not influenced by other services provided to that client. The "Fee Dependency" interpretation (ET §1.230.040) addresses the self-interest and undue influence threats as related to fees from an attest client.
To assist members in identifying fee-related threats, PEEC is proposing updated examples of threats in the "Conceptual Framework for Independence" (ET §1.210.010).
PEEC is seeking input on several questions related to the proposed changes. Those questions are in the exposure draft. PEEC welcomes input on the questions and on other topics.
Comments are due by June 15 to ethics-exposuredraft@aicpa.org.
PEEC addresses recent occurrences of cheating
Last year, the SEC sanctioned several firms whose employees were discovered sharing answer keys to various CPE courses, and state boards of accountancy have disciplined the individuals involved. To clarify AICPA members' responsibilities in this area, PEEC is proposing revisions to related interpretations for all members (ET §§1.400.001, 2.400.001, and 3.400.001).
PEEC welcomes input on the proposed changes, which are in the exposure draft. Comments are due by May 15 to ethics-exposuredraft@aicpa.org.
— To comment on this article or to suggest an idea for another article, contact Kelly Mullins at Kelly.Mullins@aicpa-cima.com.
