Integrity - Purple Milestone

These are scenarios for the purple Integrity milestone - related to the AICPA Code of Professional Conduct.

You can ask your teammates for help in answering these questions and you can also use the resource guide or links to find the answers. The key to success is discussing the scenarios with your teammates and sharing your knowledge with each other.

Abbreviations used include:
• OBA - Oregon Board of Accountancy
• OAR - Oregon Administrative Rules
• ORS - Oregon Revised Statutes
• CPC - AICPA Code of Professional Conduct

You will have 25 minutes to complete as many of these questions as possible. Work as a team to read the questions, discuss the ethical dilemmas and use the resource guide to find answers to questions you don't know how to answer.

Once you and your teammates agree on the answer type your answer into the box provided and submit it.

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* 1. Your supervisor asks you to adjust your financial results on the latest income statement because the current report will likely be received negatively by Wall Street analysts.  When you challenge this request your supervisor threatens to deny the promotion you have requested unless you make the change to your report.

What type of threat is this and what can you do about this?  If your teammates agree with your answer earn 6 PEPs, otherwise, lose 10 for succumbing to the pressure.

CPC 2.170.010 Pressure to Breach the Rules

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* 2. A friend sends you a link to a social media discussion from a client's CFO who posted a request for help to reorganize his accounting department. He reveals financial results for his privately-held company in this discussion post.

What are your obligations to report this under the AICPA Code of Professional Conduct?  Earn 3 PEPs for your answer.

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* 3. Big Boss reminds you to use the Resources Guide on your table to look up key elements of the AICPA Code of Professional Conduct.

You can use your cell phone or the Resource guide on your table to get instructions on how to access the CPC electronically and find answers to any question with a reference.

Enter the names of your teammates who are currently at the table. If any teammate is not seated lose 2 PEPs.

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* 4. You have a heated debate with your supervisor about treatment of an accounting transaction. You completely disagree with the supervisor's decision because results could be impacted in a significantly negative way. 

What are your obligations for maintaining integrity in this situation?  Earn 3 PEPs for your response. 

CPC Knowing Misrepresentation 2.130.010 and Subordination of Judgment 2.130.020

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* 5. You've been a CPA in industry for a long time but you let your license lapse for failing to complete CPE requirements.  However, you still tell people you're a CPA.

Can this statement be treated as misleading or deceptive behavior per 2.400.001 Acts Discreditable? Why or why not?

Your team can award or deduct 4 PEPs for your answer.

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* 6. Your supervisor sends you to training on the latest social networking techniques.  This training teaches how to communicate your company's services more effectively.

You go to the first half of the training, but skip out at the break to go play golf.

Explain how this could be Ethical behavior or lose 3 PEPs.

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* 7. A teammate stops by your office late one night to tell you they've learned of a major theft of resources at a client. Approximately $500K per year has been diverted to several mid-level managers for personal use. You knew this.

Lose 12 PEPs for not reporting this and compromising the team's integrity.

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* 8. You're required to sign a statement that you read the AICPA Code of Professional Conduct and agree to comply with it.  You never actually read the entire code but sign this statement anyway.

How does this affect your reputation for honesty? Your team can award you 1, 2 or 3 PEPs for your response.

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* 9. You hear one of your staff making a service delivery promise to a client you know you cannot meet. When you ask him about it, he denies it, saying the client misunderstood.

What are the ethical issues affecting your firm and the client?

Earn 2 PEPs if you can identify 3 issues.

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* 10. You're the supervisor on a client job. One of your staff consistently turns in work papers with small, inadvertent errors.  

You're reviewing AICPA CPC 0.300.040.03 titled Integrity. Are these consistent errors enough to question your staff member's integrity?  Why or why not?

Your team can award you 1, 2 or 3 PEPs.