Tax Research Worksheet #6 Spring 2010 Due: March 29, 2010 Schmitt 15 points Tax accountants are governed by legal, ethical and professional standards. Failure to live up to these standards can result in the loss of clients, legal liability, a suspension of the right to practice or even criminal sanctions. But more importantly, an accountant must live with his or her own professional behavior. Below are several different cases which require decisions as to what is permitted or expected. For each situation, indicate what you believe is the appropriate action. In each case, your action should take into consideration existing professional standards and regulatory authority. Case 1 Anderson, Inc., a client for several years, has again asked you to prepare its tax return. While examining its records you determine that the corporation's bookkeeper made an error in the prior year. A large dividend paid to Anderson, Inc.'s shareholders was charged to interest expense. You did not detect the error last year, and as a result deducted the dividend as interest expense. What
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Corporation, Expense, Taxation in the United States, professional standards, Tax Research Worksheet