Code Of Professional Ethics By American Institute Of Certified Public Accountants

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to
clients, Responsibilities to colleagues and Other responsibilities and
Practices. Independence has always been the fundamental concept to the
accounting profession. In fact it is the most essential to the practice of all
professions. The financial reports produced by CPAs would be of little value to
the public unless CPAs maintain their independence. Independence has always been
associated with integrity and objectivity. Since faults on financial
statements may be the result of either a honest mistake or a lack of integrity
it is imperative to associate the notion of independence with the objectivity
and integrity. As part of the requirements by the Code of ethics, CPA should
avoid any relationships that may result in the CPA's becoming dependent on the
particular client. Such relationships include financial interests and client
management. It is very important that the opinion of the CPA reflects the
results of operating decisions taken by the client and not any underlying ...

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engagements. However the Code states that CPAs should
insist on disclosing in financial reports, all information necessary for the
fair presentation of the clients' affairs.

The accountancy laws in some states of the USA contain provisions which do not
require disclosing information obtained during engagement by accountant in any
court. These clauses directly interfere with federal jurisdiction. Federal
courts have held that a "state statute conferring privileged status on
communications to accountants does not apply to a Federal administrative
proceedings" (Carey and Doherty: p. 133) and may require disclosure of the
information by CPA.

With reference to the Responsibilities to ...

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