Question 1

Any complaint against a member must be submitted in writing.

Accepted Answer

A) True 
 B)False

Question 2

Under the limited liability partnership (LLP) form of organization, the only partners with personal assets at risk are those involved in the litigated engagement, while the others risk only their investment in the partnership.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following conditions is consistent with a contingency fee?

Accepted Answer

A)  Its terms must be contracted for before any services are performed. 
B)  Its terms must be contracted for after any services are performed. 
C)  The fees are fixed by a court. 
D)  The amount paid for the performance is not affected by the results obtained. 
A)  Its terms must be contracted for before any services are performed. 
B)  Its terms must be contracted for after any services are performed. 
C)  The fees are fixed by a court. 
D)  The amount paid for the performance is not affected by the results obtained.

Question 4

Withholding a client's books and records when the client has requested their return is an example of ________.

Accepted Answer

A)  a contingency 
B)  a discreditable act 
C)  fraud 
D)  self-regulation 
A)  a contingency 
B)  a discreditable act 
C)  fraud 
D)  self-regulation

Question 5

Successor auditors are required to make certain enquiries of predecessor auditors when a new client is obtained.

Accepted Answer

A) True 
 B)False

Question 6

In the interest of independence, CPAB and SOX require the rotation of the lead audit partner and/or concurring review partner every ________.

Accepted Answer

A)  year 
B)  two years 
C)  five years 
D)  ten years 
A)  year 
B)  two years 
C)  five years 
D)  ten years

Question 7

Firms commonly obtain new clients through advertising.

Accepted Answer

A) True 
 B)False

Question 8

According to the profession's rules of conduct, an auditor would be considered independent in which of the following instances?

Accepted Answer

A)  The auditor is the officially appointed stock transfer agent of a client. 
B)  The auditor has a personal chequing account in a branch of a client bank. 
C)  The client has not paid its audit fees for the past three years. 
D)  The client is the only tenant in a commercial building owned by the auditor. 
A)  The auditor is the officially appointed stock transfer agent of a client. 
B)  The auditor has a personal chequing account in a branch of a client bank. 
C)  The client has not paid its audit fees for the past three years. 
D)  The client is the only tenant in a commercial building owned by the auditor.

Question 9

Specific items in the rules of conduct may not necessarily be based on one of the ethics principles, but, instead, they may involve various elements of different ethical theories.

Accepted Answer

A) True 
 B)False

Question 10

Confidentiality principles allow a PA to ignore the obligation to comply with a validly issued subpoena or summons.

Accepted Answer

A) True 
 B)False

Question 11

Briefly describe the process followed by CPA Ontario when investigating and charging a member with violating one of the rules of professional conduct.

Accepted Answer

Any complaint against a member must be s

Question 12

Discuss the rules allowing members to practice in any form of organization.

Accepted Answer

The rules allow members to practice in a

Question 13

CPA Ontario Rule 214 regarding fee quotation is ultimately concerned with ________.

Accepted Answer

A)  auditor independence 
B)  confidentiality 
C)  audit quality 
D)  contingency fees 
A)  auditor independence 
B)  confidentiality 
C)  audit quality 
D)  contingency fees

Question 14

Auditors' moral responsibilities can be summarized as

Accepted Answer

A)  Formal ethical responsibilities of auditors. 
B)  Rules that must be followed by auditors. 
C)  The idea that public accountants (PAs) should be upright, not kept upright 
D)  A formal set of rules for the proper conduct of the auditor. 
A)  Formal ethical responsibilities of auditors. 
B)  Rules that must be followed by auditors. 
C)  The idea that public accountants (PAs) should be upright, not kept upright 
D)  A formal set of rules for the proper conduct of the auditor.

Question 15

The CPA Ontario Rules of Professional Conduct prohibit CAs from accepting contingency fees under any and all circumstances.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following statements regarding independence and litigation is FALSE?

Accepted Answer

A)  When a public accountant (P
A)  and a client move into an adversary relationship and away from the cooperative one needed in an assurance engagement, independence is threatened by appearances of the PA trying to serve his or her own best interests. 
B)  PAs are still considered independent even if company management threatens to start a lawsuit against them. 
C)  PAs are not considered to be independent when company management actually starts a lawsuit against them. 
D)  PAs are not considered to be independent when company management alleges deficiencies in audit or other assurance work. 
A)  When a public accountant (P
A)  and a client move into an adversary relationship and away from the cooperative one needed in an assurance engagement, independence is threatened by appearances of the PA trying to serve his or her own best interests. 
B)  PAs are still considered independent even if company management threatens to start a lawsuit against them. 
C)  PAs are not considered to be independent when company management actually starts a lawsuit against them. 
D)  PAs are not considered to be independent when company management alleges deficiencies in audit or other assurance work.

Question 17

As self-regulating bodies, professional institutes have a duty to investigate all written complaints received about their members and students accepted into their programs.

Accepted Answer

A) True 
 B)False

Question 18

Discuss the deficiencies in professional codes of conduct for public accountants (PAs).

Accepted Answer

Whenever there is a conflict-of-interest

Question 19

Canada Revenue Agency (CRA) has requested the taxes payable working papers of ABC Co. from CPA. CPA should ________.

Accepted Answer

A)  request client permission, and then provide the working papers 
B)  not provide the working papers nor discuss the matter with the client 
C)  inform the client that the working papers should not be provided 
D)  provide the working papers immediately to avoid tax problems 
A)  request client permission, and then provide the working papers 
B)  not provide the working papers nor discuss the matter with the client 
C)  inform the client that the working papers should not be provided 
D)  provide the working papers immediately to avoid tax problems

Question 20

Summarize the professional competence and due care rules of the codes of conduct.

Accepted Answer

The professional competence and due care

Exam 18: Professional Rules of Conduct Details and Auditor Responsibilities

Any complaint against a member must be submitted in writing.

Under the limited liability partnership (LLP) form of organization, the only partners with personal assets at risk are those involved in the litigated engagement, while the others risk only their investment in the partnership.

Which of the following conditions is consistent with a contingency fee?

Withholding a client's books and records when the client has requested their return is an example of ________.

Successor auditors are required to make certain enquiries of predecessor auditors when a new client is obtained.

In the interest of independence, CPAB and SOX require the rotation of the lead audit partner and/or concurring review partner every ________.

Firms commonly obtain new clients through advertising.

According to the profession's rules of conduct, an auditor would be considered independent in which of the following instances?

Specific items in the rules of conduct may not necessarily be based on one of the ethics principles, but, instead, they may involve various elements of different ethical theories.

Confidentiality principles allow a PA to ignore the obligation to comply with a validly issued subpoena or summons.

Briefly describe the process followed by CPA Ontario when investigating and charging a member with violating one of the rules of professional conduct.

Discuss the rules allowing members to practice in any form of organization.

CPA Ontario Rule 214 regarding fee quotation is ultimately concerned with ________.

Auditors' moral responsibilities can be summarized as

The CPA Ontario Rules of Professional Conduct prohibit CAs from accepting contingency fees under any and all circumstances.

Which of the following statements regarding independence and litigation is FALSE?

As self-regulating bodies, professional institutes have a duty to investigate all written complaints received about their members and students accepted into their programs.

Discuss the deficiencies in professional codes of conduct for public accountants (PAs).

Canada Revenue Agency (CRA) has requested the taxes payable working papers of ABC Co. from CPA. CPA should ________.

Summarize the professional competence and due care rules of the codes of conduct.

Introduction to Auditing

Auditors Professional Roles and Responsibilities

Auditors Ethical and Legal Responsibilities

Reports on Audited Financial Statements

Preliminary Audit Planning: Understanding the Auditees Business

Assessing Risks in an Audit Engagement

Internal Control Over Financial Reporting

Audit Evidence and Assurance

Control Assessment and Testing

Audit Sampling

The Revenues, Receivables, and Receipts Process and Cash Account Balance

The Purchases, Payables, and Payments Process

Payroll and Production Processes

The Finance and Investment Process

Completing the Audit Work

Applying Professional Judgment to Form the Audit Opinion and Issue Theaudit Report

Other Public Accounting Services and Reportsreviews and Compilations

Part I the Audit of Accounting Estimates: Basic Material Relating to Accountingestimates

Legal Liability Cases

Other Professional Accounting Services and Reports, Including Fraud

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