QUESTION 1.docx - ACC305 INDIVIDUAL ASSIGNMENT 1 QUESTION...

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ACC305 INDIVIDUAL ASSIGNMENT 1
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QUESTION 1 (24 MARKS) The following situations may or may not breach the ethical requirements of APES 110. You need to state whether they are or are not a breach of the ethical requirements of APES110 and if they are a breach of the ethical requirements state which ethical principle has been breached : (a)The Mortdale Accounting firm had carried out several audits of public companies in the last year.It now provided the working papers to the Penshurst Accountants who were carrying out a peer review of the audits by Mortdale Accounting.The Mortdale Accounting firm does not advise its clients of these reviews. This a not breach of APES 110 ethical principle The firm has a duty of confidentiality and therefore it should not disclose the weak financial position of the firm to the clients. It should however, recommend the provision on the grounds that there have been no subsequent collections from the firm. If this argument is not accepted by the management of the company as they contend that the firm may be slow payer as in the past but has never ever committed a default, the auditor will be in a delicate situation. If the firm qualifies and discloses the fact to the company it will be guilty of breach of code of ethics (b) Jan Dungog,a CPA , applies to a local public accounting firm of Chartered Accountants, for a position ,but asks the local public accounting firm not to contact her current employer. The local public accounting firm do not contact her contact her current employer but hire her without contacting them or her other referees .
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  • Summer '12
  • Dr. Cherus
  • Accountant, Chartered Accountant, ethical requirements, accounting firm, Allgood Chartered Accounting firm

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