Question 1

An accountant is most likely to be held to a fiduciary standard when:

Accepted Answer

A)  The accountant is involved in preparing corporate filings for submission to the SEC 
B)  A client is in an especially vulnerable financial position 
C)  A contingent fee arrangement exists between an accountant and a client 
D)  Accountant-client conflicts of interest do not exist or are fully disclosed 
A)  The accountant is involved in preparing corporate filings for submission to the SEC 
B)  A client is in an especially vulnerable financial position 
C)  A contingent fee arrangement exists between an accountant and a client 
D)  Accountant-client conflicts of interest do not exist or are fully disclosed

Question 2

Why would a person create a split-interest trust?

Accepted Answer

A person might create a split-interest t

Question 3

Sherry Hartwog is the managing partner of Hartwog and Associates,CPAs.This CPA firm operates out of a single office in Greenwich,Connecticut.Bantam Boxers,Inc.is an audit client of Hartwog and Associates,CPAs.The CEO of Bantam Boxers,Inc.recently told Hartwog that he had named Hartwog to serve as an executor of his estate after his death.The CEO owns 40% of the stock outstanding in Bantam Boxers,Inc.Does Hartwog and Associates,CPAs retain the independence to complete its current-year audit Bantam Boxers,Inc.?

Accepted Answer

A)  Yes, because the CEO is still alive 
B)  Yes, as long as Hartwog is only a co-executor 
C)  Yes, as long as none of the CEO's estate beneficiaries own stock in Bantam Boxers 
D)  No 
A)  Yes, because the CEO is still alive 
B)  Yes, as long as Hartwog is only a co-executor 
C)  Yes, as long as none of the CEO's estate beneficiaries own stock in Bantam Boxers 
D)  No

Question 4

Can a split-interest trust also be a testamentary trust?

Accepted Answer

Yes, a split-interest trust can also be

Question 5

An auditor that properly satisfies the Independence Rule will,with regard to an audit client:

Accepted Answer

A)  Never be a fiduciary 
B)  Always be a fiduciary 
C)  Be a fiduciary if the audit client is a bank or other so-called public-interest client 
D)  Be a fiduciary if the audit client poses an undue influence threat 
A)  Never be a fiduciary 
B)  Always be a fiduciary 
C)  Be a fiduciary if the audit client is a bank or other so-called public-interest client 
D)  Be a fiduciary if the audit client poses an undue influence threat

Question 6

A CPA acting as an executor of an estate:

Accepted Answer

A)  Owes a duty of loyalty to the deceased 
B)  Owes a duty of loyalty to the deceased's heirs 
C)  Owes a duty of loyalty to the deceased's closest living relative 
D)  Owes a duty of prudent management, but does not owe a duty of loyalty 
A)  Owes a duty of loyalty to the deceased 
B)  Owes a duty of loyalty to the deceased's heirs 
C)  Owes a duty of loyalty to the deceased's closest living relative 
D)  Owes a duty of prudent management, but does not owe a duty of loyalty

Question 7

A CPA recently inherited $400,000 of stock outstanding in one of her audit clients.In an attempt to maintain her independence,she placed her holdings of this audit client's stock into a trust.The trust is managed by a well-known independent trustee,JP Bankers Trust Services.The CPA's two young children are the sole beneficiaries of this trust.The CPA:

Accepted Answer

A)  Successfully has maintained her independence because none of the trust's assets directly benefit her 
B)  Successfully has maintained her independence because she does not have control of these assets 
C)  Has not maintained her independence because of the serious self-review threat presented 
D)  Has not maintained her independence because she still is considered to have an interest in her audit client 
A)  Successfully has maintained her independence because none of the trust's assets directly benefit her 
B)  Successfully has maintained her independence because she does not have control of these assets 
C)  Has not maintained her independence because of the serious self-review threat presented 
D)  Has not maintained her independence because she still is considered to have an interest in her audit client

Question 8

A CPA audits Amberset Corporation.This CPA has been named to serve as the trustee of a trust fund that a client set up for the benefit of her grandchildren.The client is the majority shareholder of Amberset Corporation,and Amberset stock is one of the trust's assets.The CPA potentially retains the independence to continue to audit Amberset Corporation only if:

Accepted Answer

A)  The CPA is a co-trustee and there are at least three co-trustees 
B)  Amberset is a publicly-traded corporation 
C)  The CPA does not directly own any Amberset stock 
D)  The CPA refuses to serve as this client's trustee 
A)  The CPA is a co-trustee and there are at least three co-trustees 
B)  Amberset is a publicly-traded corporation 
C)  The CPA does not directly own any Amberset stock 
D)  The CPA refuses to serve as this client's trustee

Question 9

A CPA is most likely to be held to the standards of a fiduciary when she:

Accepted Answer

A)  Performs tax accounting services 
B)  Serves as investment fund manager 
C)  Performs attest services other than audits 
D)  Performs audits 
A)  Performs tax accounting services 
B)  Serves as investment fund manager 
C)  Performs attest services other than audits 
D)  Performs audits

Question 10

Why types of ethical dilemmas concerning independence do CPAs who specialize in auditing face when serving as a trustee of a trust?

Accepted Answer

Certified Public Accountants (CPAs) who

An accountant is most likely to be held to a fiduciary standard when:

Why would a person create a split-interest trust?

Can a split-interest trust also be a testamentary trust?

An auditor that properly satisfies the Independence Rule will,with regard to an audit client:

A CPA acting as an executor of an estate:

A CPA is most likely to be held to the standards of a fiduciary when she:

Why types of ethical dilemmas concerning independence do CPAs who specialize in auditing face when serving as a trustee of a trust?

Introduction to Ethics

Ethical Principles and Reasoning

The Core Philosophies

Virtue,justice,and Social Responsibility

Why We Cheat

Greed,corruption,and Collusion

Fraud and Earnings Management

Discreditable Acts: Discrimination,deceit,and Disclosure

Confidentiality

Independence and Moral Seduction

Conflicts of Interest

Duties As a Whistleblower

Duties of Public-Company Auditors: the Sarbanesoxley Act

Duties of Tax Professionals

Duties in the Accounting Workplace Online Only

Filters

Exam 15: Duties of Fiduciaries: Financial Planners,trustees,and Executors

An accountant is most likely to be held to a fiduciary standard when:

Why would a person create a split-interest trust?

Can a split-interest trust also be a testamentary trust?

An auditor that properly satisfies the Independence Rule will,with regard to an audit client:

A CPA acting as an executor of an estate:

A CPA is most likely to be held to the standards of a fiduciary when she:

Why types of ethical dilemmas concerning independence do CPAs who specialize in auditing face when serving as a trustee of a trust?

Introduction to Ethics

Ethical Principles and Reasoning

The Core Philosophies

Virtue,justice,and Social Responsibility

Why We Cheat

Greed,corruption,and Collusion

Fraud and Earnings Management

Discreditable Acts: Discrimination,deceit,and Disclosure

Confidentiality

Independence and Moral Seduction

Conflicts of Interest

Duties As a Whistleblower

Duties of Public-Company Auditors: the Sarbanesoxley Act

Duties of Tax Professionals

Duties in the Accounting Workplace Online Only

Filters