Acct 402 Ethical Considerations and Regulatory Compliance in Financial and
Political Practices: A Comprehensive Analysis
Final Examination Acct 402 Ethics
1) The first entity is a CPA firm that has been cited for tax ethical violations. Indicate what
guidelines the firm will have to put in place to comply with ethical considerations as specified
by the AICPA. Be sure to indicate how the firm will change into an ethical practice and obtain
assurance that these directives are being followed.
Ans: It is very important that ethical practices are followed while going for financial reporting of
the firm. While preparing for the financial reporting of the company, it is the CPA firms that help in
preparing the financial report for the companies and submit the report to the management of the
company for onward submission to the governing bodies. Here we are discussing about the publicly
help companies whose stocks are listed in the stock exchange. The CPA firm should help the
company in such a way that, the company has zero obligations to meet out after the financial
reporting. It is minimum decorum which needs to be maintained by the company to run the business
for an unlimited period and establish its existence in the society to do a successful business. Each
company should honor the tax payment which is due to the company and there should not be any
dispute while making the tax payment to the tax authorities. Here in this case, it is mentioned that,
the CPA firm was engaged in tax ethical violations. It means there are many possibilities in this
regard like the CPA firm has taken bribe and tried to present the financials in a different way where

as per the calculations, there won’t be less tax due to the tax authorities, where as the actual
calculations result different tax amount, for which the company owes certain amount to the tax
authorities. This kind of wrong engagement by the CPA firms will mislead the company and the
company may have close its doors very soon. So it is very important that, the requisite steps are
taken up by the CPA firm for calculating the tax amount with proper guidance to the management of
the company.
Following are the some of the ethical standards which are need to be followed by the CPA firms while
going for executing their duty from time to time:
As per the AICPA guidelines, the code of professional conduct of the American Institute of Certified
Public Accountants got to comply to two sections namely (i) The Principles and (ii) The Rules. The
principles laid offer a better platform for the Rules which monitor the performance executed by the
professional services of all the members. The American Institute of Certified Public Accountants
councils is corely authorized for designating bodies for circulating technical standards with
consideration of Rules and bylaws are needed to stick to those Standards and Rules. The professional
Conduct Code was adopted by the membership for providing rules and guidance for all the members
practicing in the public, industry, government, and education etc in the responsibilities of professional
performance. Complying with the Code of Professional Conduct with all kind of standards enacted from
time to time, in a society which is open in nature basically is vested with primarily on the understanding
of the members with actions voluntarily and secondly reinforcement by the public opinion and the peers
and eventually disciplinary actions when required against all the members failing to comply with the
Rules.

Interpretation of Rules of Conduct enables to interpret that has been adopted after having exposure to the
state societies, practice units, Boards at the state level etc along with other parties who are corely
interested in the guidelines by the professional division’s of ethics offers guidelines in order to
understand the scope and application of rules but are not purposefully limited to these scopes and
applications. A member who does not follow these guideline, need to proper clarifications of why these
kind of rules were not complied with and deviated.
Apart from the above, the CPA firm needs to follow the concept of Responsibilities, The Public Interest,
Integrity, Objectivity & Interdependence, Due Care, Scope and Nature Of Service etc. So adoption of
above aspects will change the firm into an ethical practice and obtain assurance that these directives are
being followed.
2) One of your clients has decided to run for U.S. Senate. She would like you to become a member
of her senior staff. Your assignment is to handle campaign contributions and be responsible
for financial reporting to the Federal Election Campaign office. Indicate what filings need to
be done and when. Explain what the candidate’s staff should do to ensure compliance with the
Federal Election Campaign Finance rules.
Ans: As per the practices, the candidate running for the U.S. Senate elections, is eligible for certain
contributions from outside, however the candidate running for becoming Senate, need to go for the
filing as per the guidelines and inform the concerned authority as per the rule regarding the funds
mobilized for his / her election campaign through different sources. The idea behind understanding
the funds movement for the candidate is only to find out, all the funds that are getting used for the
election campaign are generated from the legal sources and there are no such influential kind of
funds which is coming thorough. Following are the list of forms that needed to be filed from time to
time.
Type Of Purpose For Which

Acct 402 Ethical Considerations and Regulatory Compliance in Financial and Political Practices: A Comprehensive Analysis

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