Transcript Ethics - Florida Government Finance Officers Association

2013
1
Today’s Discussion Leader is…
Winter Park
(407) 740-5400
[email protected]
2
FICPA Member Service Center
(800) 342-3197 (in Florida) or (850) 224-2727
www.ficpa.org/ethics
Ethics Sponsor ID (FBOA): 3461
QAS Sponsor ID: 014
DBPR live presentation ID: 4980
3
100
Minutes
Break
100
Minutes
4







Course evaluations
Confirmation of attendance
DBPR and BOA course ID numbers
Type of credit – Ethics (ETH)
Participant request - enter/leave quietly
Participant request - cell phones
Other matters
5
Background and Overview
p. 1-1
6






Explain Florida’s ethics requirement for CPE
Define the term “ethics”
Describe the origins of ethical behavior
Explain how the AICPA’s Code of Professional Conduct
applies to CPAs licensed in Florida
Apply the AICPA’s Ethics Decision Tree to workplace
situations
Describe an auditor’s ethical responsibilities under the
Government Auditing Standards (Yellow Book)
p. 1-1
7
p. 1-1
61H1-22.001
8
473.312 Continuing Education
(c) Not less than 5 percent of the total hours required by
the board shall be in ethics applicable to the practice of
public accounting. This requirement shall be
administered by providers approved by the board and
shall include a review of the provisions of chapter 455
and this chapter and the related administrative rules.
p. 1-1
9

80 hours over a two-year reporting period

20 hours of Accounting and Auditing
20 hours of Behavioral – maximum
4 hours of Ethics
No limitation or requirement for Technical Business



p. 1-1
10

Florida became the 37th state to establish an ethics
requirement

Outlined by Florida Board of Accountancy (see
61H1-33.003)

FICPA’s support is in line with national support
p. 1-2
11




80 hours over a two-year reporting period, essentially,
80 hours of CPE
CPE to “directly enhance the auditor’s professional
proficiency”
24 hours directly related to governmental topics
20 out of the 80 hours to be completed in any one
year
p. 1-2
12
LOCAL
Rules
Policies
STATE
Florida Statutes
FL Admin Code
NATIONAL
Yellow Book
AICPA Code of Conduct
Policies may contradict. Are you responsible to
follow more than one?
p. 1-4
13

Relationship of Florida laws and rules to national
standards

Florida Statutes, Chapter 455, 473, and FAC 61H1

Issues of competency in public accounting

Auditor’s ethical responsibilities – Yellow Book
p. 1-4
14

The relationships of ethics and independence rules
and implications to public accounting

Government auditing standards – independence
requirements

Ethical responsibilities to clients other practical
considerations

Future implications for CPAs
p. 1-4
15
The discipline dealing
with what is good and
bad with moral duty and
obligation.
p. 1-5
16
“The term, ethical behavior, refers to how an organization
ensures that all its decisions, actions, and stakeholder
interactions conform to the organization’s moral and
professional principles. These principles should support all
applicable laws and regulations and are the foundation for the
organization’s culture and values. They define ‘right’ from
‘wrong’ behavior.”
--National Malcolm Baldridge
Quality Award
p. 1-6
17
Ethics are:

A set of moral principles or values

A theory or system of moral values

The principles of conduct governing an individual or a
group

A guiding philosophy
p. 1-6
18
Key expressions include:
1.
What ought a person to do?
2.
What ought a person to not do?
3.
What attitudes are viewed as good?
4.
What behaviors are viewed as good?
5.
Why are they viewed as good?
p. 1-6
19



Ethics has traditionally been considered a part of
philosophy
Philosophy is a study of the principles of any activity
It is a systematic examination of basic concepts such
as:
o
o
o
o
o
p. 1-6
Truth
Existence
Reality
Causality
Freedom
20
Behavioral sciences include:

Psychology

Sociology

Cultural Anthropology
p. 1-7
21

Religion has a concern with moral conduct influencing
normal behavior

Religions may have different sets of ethical values
depending on the religion

Ethics is often a common ground for different religions
p. 1-7
22
Can one teach someone to be ethical?
No, it is either in one’s self or it is not.
Can one teach someone what is ethical behavior?
Yes, it is a system of values or principles for
actions.
p. 1-8
23

The ethics requirements in the CPA profession in
Florida (and maybe everywhere) most likely come as a
response to a crisis.

The responses have been at many levels:
o Regulatory
o Educational
o Personal
p. 1-8
24



The ethics of our profession begin with the individual
Organizational ethics are guided by individual ethics
CPA reputation has been based on core values for
over 100 years
o Honesty
o Integrity
o Trustworthiness
p. 1-9
25


Increased emphasis on ethics at state and national
levels
Changes in our profession
o Ownership
o Solicitation
o Commissions
o Sale of financial products
o Competitive bidding
p. 1-9
26







Securities and Exchange Commission
PCAOB
AICPA
FICPA
IRS
State Regulatory bodies
Others
p. 1-9
27

Public perception of accountants

Ethical decision making

Current examples of ethical behavior
p. 1-10
28
.02 These principles express the profession‘s
recognition of its responsibilities to the public, to
clients, and to colleagues. They guide members in
the performance of their professional responsibilities
and express the basic tenets of ethical and
professional conduct. The principles call for an
unswerving commitment to honorable behavior, even
at the sacrifice of personal advantage.
p. 1-10
29
1.
Whom does the Code of Professional Conduct govern?
2.
Can the AICPA revoke my license due to a disciplinary
matter?
3.
Does the AICPA contact other state CPA societies and
regulatory agencies having disciplinary responsibilities?
p. 1-11
30
4.
Do other state CPA societies and federal and/or state
regulatory agencies refer matters to the AICPA?
5.
Am I subject to the same rules of the Code if I practice
public accounting or work in business and industry?
6.
How could I have a conflict of interest when I am no
longer working in public accounting?
p. 1-12
31
 For
Government
 Also one for Auditors and Businesses
p. 1-16
32
Ethical Beliefs and Behaviors
in US Businesses and
Government Agencies
Learning Objectives …
p. 2-1
33

Review the 2011 National Business Ethics Survey

Examine the main points and recommended action
steps from Retaliation in the Workplace

Examine the main points and recommended action
steps from 2012 Report to the Nations
p. 2-1
34

The Ethics Resource Center (ERC) was founded in
1922, and is America’s oldest non profit organization
devoted to the advancement of high ethical standards
and practices in public and private institutions

2011 National Business Ethics Survey, 7th in the series

ERC polled over 3,000 employees in the business,
government and non profit sectors

Longitudinal research study; identifies context for
national trends
p. 2-1
35
70%
65%
60%
50%
63%
45%
49%
42%
40%
2009
35%
30%
2011
20%
13%
10%
8%
0%
Witnessed
misconduct
p. 2-2
Reported misconduct
Ethical culture
strength
Pressure to commit
violations
36
p. 2-2
37



Post-recession employee conduct is similar to behavior
during the recession
This phenomenon is a significant factor in the
historically low rates of misconduct and high rates of
reporting
Historical data shows ethical conduct improves when
the economy cools
p. 2-3
38



Active social networkers report more negative experiences
in their workplaces
Also more likely to experience pressure to compromise
ethics and to experience retaliation for reporting
misconduct than less active social networkers
32% of active social networkers are more likely to feel
pressure than less active networkers and non-networkers
p. 2-4
39
p. 2-4
40












64%
62%
62%
56%
55%
51%
46%
44%
32%
31%
31%
29%
p. 2-5
Excluded from decisions and work activity
Received a cold shoulder
Verbally abused by management
Almost lost their job
Not given promotions or raises
Verbally abused by other employees
Cut in pay or hours
Relocated or reassigned
Demoted
Experienced physical harm to person or property
Experienced online harassment
Harassed at home
41





City Ethics - www.cityethics.org
FirstGov.gov - www.firstgov.gov/
Dodd-Frank Wall Street Reform & Consumer Protection
Act - http://sec.gov/spotlight/dodd-frank.shtml
House Committee on Standards of Official Conduct www.house.gov/ethics
US Office of Government Ethics - www.usoge.gov
p. 2-9
42

Survey conducted by the Association of Certified Fraud
Examiners

Global study based on data from 1,388 fraud cases

2012 Report to the Nations, 7th in the series

Longitudinal research study; identifies context for global
trends
p. 2-9
43

Impact of Occupational Fraud – organizations lose 5%
of revenue annually

Fraud Detection – takes 18 months to be detected

Victims of Fraud – larger impact to smaller businesses,
fewer anti-fraud controls, less able to recover losses

Perpetrators of Fraud – higher levels of authority
caused greater losses, most are first-time offenders
p. 2-10
44
 Retaliation
and ethical conduct
 Whistleblowing
p. 2-11
45
Assurance Provided by Regulation
(Chapter 455)
Learning Objectives …
p. 3-1
46



Describe the role of the Florida Board of Accountancy
per Chapter 455, FS
Describe the complaint process used by the Florida
Board of Accountancy
List reasons that would cause the Florida Board of
Accountancy to impose disciplinary actions on a CPA per
Chapter 455.227, FS
p. 3-1
47
(455.01(1), FS)

Powers and duties include:
o Authority to issue citations
o Conduct disciplinary proceedings
o Designate violations
o Recover costs
p. 3-1
48
The Division of
Certified Public
Accounting is a
division within
Florida’s
Department of
Business and
Professional
Regulation (DBPR)
p. 3-2
Tallahassee, Florida
Department of Business and
Professional Regulation
Headquarters
Gainesville, Florida
Section 20.165(2)(c)(2), Florida
Statutes, states that the Division of
Certified Public Accounting shall be
located in Gainesville.
49

The division is responsible for the licensing and
regulation of over 31,400 Certified Public
Accountants (CPAs) and over 5,200 CPA firms
29,203
2,228
5,213
Active CPAs
Inactive CPAs
Accounting Firms
Source: DBPR Division of Certified
Public Accounting, May 2013
p. 3-2
50
07-08 08-09 09-10 10-11 11-12
Total received
334
304
301
328
230
Legally sufficient
34
350
235
161
123
Probable cause
found
10
69
55
183
35
No probable cause
111
206
172
150
13
Administrative
10
36
24
22
8
Disciplinary action
10
5
48
27
16
Source: DBPR Annual Reports
p. 3-2
51
2011
2012
Cases opened during period
328
230
Admonished
13
161
Corrective action required
91
244
No violation/ dismissed
50
36
No further action
53
182
Subsequent monitoring completed
satisfactorily
29
32
Disciplinary action
10
5
p. 3-3
52

What is ‘legally sufficient’?
o A complaint is legally sufficient is it contains ultimate
facts that show a violation of chapter 455, FS, Chapter
473, F.S. or Chapter 61H1, FAC

What is ‘probable cause’?
o If members of the Probable Cause Panel determine that
there is Sufficient Evidence to support the filing of
charges against a licensee
p. 3-3
53
The Division is responsible
for reviewing complaints for
legal sufficiency
Complaints found to have legal
sufficiency are forwarded to the
Office of General Counsel (OGC)
OGC Prosecuting
Attorney presents case
to the Probable Cause
Panel to determine if
probable cause exists,
and/or to determine if the
complaint should be
forwarded to a consultant
for further investigation
Cases found to have probable
cause are presented to the full
board for final action.
Final Order
p. 3-5
54

Deny an application for licensure

Revoke or suspend a license

Impose fine not to exceed $5,000 for each count

Issue a reprimand

Place licensee on probation for a period of time and
possible CPE or work under the supervision of another
licensee

Restrict scope of practice
p. 3-9
55

Violation of any provisions of FS 455.227(1) or any
other provision of FS 473

Attempting to procure a license to practice public
accounting by bribery or fraudulent misrepresentations

Having a CPA license revoked, suspended, denied, or
otherwise acted against by the licensing authority of
another state, territory, or country
p. 3-14
56

Being convicted or found guilty, or entering a plea of
nolo contendere to a crime in any jurisdiction directly
relating to practice of public accounting or ability to
practice

Making or filing a false report or record that licensee
knows to be false
p. 3-15
57

Other grounds include:
o False or fraudulent advertising
o Committing acts of fraud, negligence,
o
o
o
o
incompetence, or misconduct
Violation of 455 or 473 or FAC
Practicing on a revoked, suspended, inactive
or delinquent license
Suspension of right to practice
Any fraudulent act while licensed
p. 3-15
58
To report unlicensed activity:
 Call the DBPR unlicensed activity hotline at
(866) 532-1440
 Email [email protected]
 Complete the online form
p. 3-16
59
Assurance Provided by Regulation
(Chapter 473)
Learning Objectives …
p. 4-1
60



Define the key terms that characterize public accounting in
Florida (473.302, FS)
Explain the basic powers and duties of the Florida Board of
Accountancy
Explain the requirements to become a CPA licensed in
Florida 473.308, FS)
p. 4-1
61




Explain the requirements for a practice to become licensed
in Florida (473.309, FS)
Name changes to a licensed firm that must be reported to
the Florida Board of Accountancy (61H1-26.004)
List the CPE requirements necessary to maintain a CPA
license in Florida (473.312, FS)
Describe the process of practice mobility in Florida
p. 4-1
62
The public is assured by the State Legislature
in the Florida Statutes, Chapter 473 that the
Legislature,
“…deems it necessary in the interest of
public welfare to regulate the practice of
public accountancy in this state.”
p. 4-1
63

Certified Public Accountant – person holding a license to
practice – 473.302(4)

Firm – Any entity engaged in practice of public accounting
– 473.302(5)

Practice of or practicing public accountancy or public
accounting – 473.302(8)(a)(b)(c)
p. 4-2
64
FS 473 gives the BOA certain powers and duties:
o Fees
o Examinations
o Licensure
o Practice requirements
o Continuing education
o Other matters
p. 4-2
65



Approximately 15,000 renew each fiscal
Continuing Professional Education
Pay renewal fee of $105
 $97 deposited into the Professional Regulation
Trust Fund
 $5 deposited into the Unlicensed Activity Trust Fund
 $3 deposited into the Minority Scholarship Trust Fund
p. 4-2
Continuing Education and payment
can be completed online at
www.MyFloridaLicense.com
66



Over 5,000 firms renew every two years
All Firm licenses expire in odd years
Pay the appropriate renewal fee:
 $150 for Partnerships, Corporations, and Limited
Liability Companies
 $50 for a Sole Proprietor and One Owner Corporation
Fund
p. 4-2
Continuing Education and payment
can be completed online at
www.MyFloridaLicense.com
67
Requirements for taking CPA Exam:

Good moral character

Meets academic requirements
o 120 hours with a concentration in accounting
and business
o Must have an additional 30 semester hours
(150 total) to be issued a license
p. 4-3
68
Requirements for getting a Florida license:

Baccalaureate degree with a major in accounting or its
equivalent plus at least 30 semester/45 quarter hours
Must have one year of work experience
Good moral character

Section 473.308(7) waiver

Five year experience as CPA


o Under CPA in any state or equivalent as determined
by the BOA
o May waive the additional education requirements
p. 4-3
69
(473.309, FS)
May not engage in practice as defined in 473.302(8)(a)
unless:
o Form recognized in Florida
o Partners/ shareholders /members owning 51% must be
CPA in some state
o Partner/ shareholder/ member domiciled in Florida must
be Florida CPA with active license
o One partner/ shareholder/ member must be Florida CPA
with active license
p. 4-6
70
(473.3101(1), FS)
Sole proprietor, partnership, corporation, limited liability
company, or any other legal entity seeking to engage in the
practice of public accounting, as defined in
s.473.302(8)(a)
o
Must file application for licensure with DBPR and supply
the required information
o
Application must be made upon the affidavit of a sole
proprietor, general partner, shareholder, or CPA member
p. 4-7
71
(473.311, FS)
The department shall renew a license upon receipt of:
 Renewal application

Fee

Certification of CPE by BOA

Exception for spouses of members of Armed Forces
(61H1-33.0065)
p. 4-8
72
(61H1-26.005, FAC)

All Florida CPAs must have their correct street address
on file with the BOA as their ‘address of record’

All Florida CPAs must notify the BOA within 30 days of
any changes to the ‘address of record’ and any change
from their original licensure application

Notification online at the Division’s site is considered
“in writing”
p. 4-9
73
(61H1-26.004, FAC)

Firm must file written notification with Department
within 30 days of:
o
Addition of any non-CPA
o
Any non-CPA co-partner, shareholder or member in any
Florida office
o
Any CPA, non-CPA co-partners, shareholders or
members have convictions or findings of guilt,
regardless of adjudication
p. 4-9
74
(61H1-26.004, FAC)
o
o
o
Having the right to practice by the SEC, IRS, others
acted against, including denial of licensure
Any other matters showing a lack of good moral
character
The retirement or death of a co-partner, shareholder or
member in any Florida office
o
A change in the name or termination of the entity
o
When the firm or any existing co-partner, shareholder
or member has been the recipient of a conviction or
finding of guilt of a crime in any civil lawsuit
p. 4-9
75


Changing your address online will satisfy the “in writing”
requirement
Do check your license periodically
o www.myfloridalicense.com
o Choose Renew a License and follow the prompts
o To log in initially, use your license number and last four
digits of your SSN

REMEMBER – you are personally responsible for
keeping your license information up to date!
p. 4-10
76

Any CPA involved in governmental audits including planning,
directing, field work, or reporting should comply with the
“Yellow Book” CPE requirements

Required to take 24 hours of CPE that directly relates to
government auditing, the government environment, or the
specific environment of the audited entity

See details at http://www.gao.gov/yellowbook

Retain documentation in case of CPE audit
p. 4-10
77

As of January 1, 2011, DBPR no longer requires CPAs to
report their CPE to DBPR

All licensees, regardless of whether you have an established
account with DBPR’s Online Services are required to
register as a new user

DBPR will rely on the honor system, self-reporting of hours
earned

Retain documentation in case of CPE audit
p. 4-11
78
(473.313 FS)

A Florida certified public accountant may request that her
or his license be placed in an inactive status by making
application to the department

The board may prescribe by rule fees for placing a license
on inactive status, renewal of inactive status, and
reactivation of an inactive license
p. 4-11
79
(61H1-33.006)

Complete forms
o DBPR 0010-2, Master Individual Application
o DBPR CPA 5011-1, Request for Change of Status

Required CPE hours
o one reporting period (120 hours)
o two reporting periods (200 hours)
o three-plus reporting periods (280 hours)
p. 4-11
80
(473.3141 FS)
Mobility (or also know as “practice mobility”) is the ability of a
licensed CPA to gain a practice privilege outside of their home
state without getting an additional license in another state where
they will be serving a client.
State Boards of Accountancy will gain automatic jurisdiction over
all CPAs practicing in their states whether they are licensed or
registered in their state.
Visit www.CPAMobility.org for practice requirements of other
states.
p. 4-13
81
82
(473.3141 FS)

2007 - only 4 states had passed mobility provisions

By 2013, 49 states have enacted mobility statutes. Guam,
Hawaii, Puerto Rico, and US Virgin Islands are “in process”.

Substantial Equivalency – 3 Issues
o Education
o Experience
o Enforcement
p. 4-13
83
(473.314 FS)

Not valid for more than 90 days

Fee of $400

Will not cover more than one engagement

Not required for person entering this state solely for the
purpose of preparing federal tax returns or advising on
federal tax matters
p. 4-13
84
(473.314 FS)

Non-Florida CPAs may provide public accounting services
in Florida without:
o obtaining a license
o notifying or registering
o paying a fee

The individual must hold a valid CPA license from a state
that is “substantially equivalent”
p. 4-14
85
(473.314 FS)


An individual who qualifies to practice may offer or
provide services in person, by mail, by telephone, or by
electronic means, and a notice, fee, or other submission
is not required
Non-Florida CPAs and their firm will consent:
o To the personal and subject matter jurisdiction and
disciplinary authority of the board;
o To comply with this chapter and the applicable board rules
p. 4-14
86
(473.314 FS)
o Practice only with a valid (non-Florida) license
o To the appointment of the state board that issued the
individual's license for any action or proceeding against the
individual or firm

An individual who qualifies to practice under this section
may perform the services identified in s. 473.302(8)(a)
only through a firm that has obtained a license issued
under s. 473.3101 or is authorized by s. 473.3101 to
provide such services.
p. 4-14
87
1. Amends 473.308(4), F.S., to allow CPAs to obtain the oneyear work experience licensure requirement through
verification by another CPA, versus direct supervision of a
CPA (current law)
2. Streamlines the licensure-by-endorsement requirements in
473.308(7), F.S. for CPAs who have held a license in
another state for at least 10 years prior to application
3. Creates a one-time amnesty to reactivate a license by
allowing CPAs to notify the BOA of their intention by Dec.
31, 2012, and complete 120 hours of continuing
professional education (CPE) by June 30, 2014
p. 4-15
88
4. Amends 473.313(3), F.S., by creating a 75-day window to
submit a renewal application, without having to apply for
reactivation, for licensees who had completed the required
CPE by Dec. 31, but failed to report
5. Provides for a BOA report to the Legislature on the
potential cost savings of privatizing or outsourcing some
Board functions
p. 4-15
89
Ethics of Integrity, Objectivity,
Commissions, Contingencies and
Communications
FAC 61H1
Learning Objectives …
p. 5-1
90





Define the term “Objectivity” as it relates to the practice of
public accounting
Define the term “Integrity” as it relates to the practice of
public accounting
Describe the concept of “materiality” as defined by FASB
No. 2, Qualitative Characteristics of Accounting Information
Describe the situations when commissions or referral fees
are allowed per Florida rule 61H1-21.003
Explain Florida’s rule 61H1-21.006 for communicating with
another client
p. 5-1
91



Explain Florida’s rule 61H1-21.006 for communicating with
another client
Define Objectivity and Integrity as well as ethical
responsibilities under Government Auditing Standards
Explain guidance regarding “gifts” at the federal and state
levels
p. 5-1
92
FAC 61H1-21.002 Integrity and Objectivity
In the Florida Administrative Code, a CPA shall not:
o Knowingly misrepresent facts
o Subordinate their judgment to:
• Clients
• Employers
• Other third parties

Florida standards have their basis in the AICPA’s standards Section 102, Integrity and Objectivity of the AICPA Code of
Professional Conduct
p. 5-1
93

Being candid

Doing the right thing

Being honest

Acting in good faith

Placing service and
public trust above
personal advantage
and personal gain

Observing both form
and spirit of
professional standards
p. 5-2
94
“Integrity can accommodate the inadvertent error
and the honest difference of opinion; it cannot
accommodate deceit or subordination of principle.”
Source: AICPA ET 54, Article III, Integrity, .02
Or, in other words …
“Doing the right thing when no one is looking.”
p. 5-2
95
(AICPA ET §102.01 Section 102)
In the performance of any professional service, a
member shall maintain objectivity and integrity, shall be
free of conflicts of interest, and shall not knowingly
misrepresent facts or subordinate his or her judgment to
others.
p. 5-2
96

AICPA ET 102.01 Rule 102

Actions deemed violations:
o Make, permit, or direct materially …false or misleading
entries
o Fail to correct materially…misleading documents or
records
o Signing, permitting to sign or directing to sign
materially…false information
p. 5-3
97
(AICPA ET §102.01 Section 102)
A conflict of interest may occur if a member performs a
professional service for a client or employer and the
member or his or her firm has a relationship with
another person, entity, product, or service that could, in
the member's professional judgment, be viewed by the
client, employer, or other appropriate parties as
impairing the member's objectivity.
p. 5-3
98




Performing litigation services for a plaintiff with a
lawsuit filed against a client of the member's firm
Providing tax or personal financial planning services for
a married couple who are undergoing a divorce, and
both parties asked the member for professional
services
Suggesting that a client invest in a business in which
he or she has a financial interest
Providing tax or PFP services for several members of a
family who may have opposing interests
p. 5-3
99



Serving on a government’s board of tax appeals, which
considers matters involving several of the member's
tax clients
Referring a PFP or tax client to an insurance broker or
other service provider, which refers clients to the
member under an exclusive arrangement to do so
Recommending a client to a service bureau in which
the member or partner(s) in the firm hold material
financial interest
p. 5-3
100
Materiality – What is it?
“Magnitude of an omission or misstatement of accounting
information that, in the light of surrounding
circumstances, makes it probable that the judgment of a
reasonable person relying on the information would
change or be influenced.”
Defined by FASB Statement of
Financial Accounting Concepts No. 2,
Qualitative Characteristics of Accounting Information
p. 5-5
101
Materiality has been defined in FASB, AICPA, SEC, and
PCAOB documents …
So, if the definitions are everywhere,
what’s the problem?
p. 5-5
102
The problem is, there is…
o No authoritative formulation of materiality in the
law or accounting literature.
o May be quite small numerically
o Must be considered quantitatively and
qualitatively
p. 5-5
103



An increased emphasis on audit quality and ethics
An extensive update of the performance audit standards to
include a specified level of assurance within the context of
risk and materiality
May need to set lower materiality levels than in private
sector–public accountability
p. 5-4
104

Rule 102-3 indicates that a member must, “…maintain
objectivity and integrity in the performance of a
professional service. In dealing with his or her
employer's external accountant, a member must be
candid and not knowingly misrepresent facts or
knowingly fail to disclose material facts. This would
include, for example, responding to specific inquiries
for which his or her employer's external accountant
requests written representation.”
p. 5-5
105

Rule 102, Ethics Ruling No. 113 – “Acceptance or
Offering of Gifts and Entertainment”

What about gifts???
o Nature of gift
o Occasion
o Cost
o Other matters
p. 5-5
106
GAS has guidance on:
 Public interest
 Professional behavior
 Integrity
 Objectivity
 Proper use of government information, resources, and
position
p. 5-6
107
(5 C.F.R. § 2635.202-204)







Use common sense
Pay your own way for meals and entertainment valued
over $20
Pay your own transportation and accommodations
Pay fair market price for products and services
Keep records of your expenses
If in doubt, don’t accept!
See Appendix C for ethics principles
p. 5-5
108
(Florida Statutes 112.3148)





Follow guidance from your own agency and FS 112.3148
Don’t accept gifts from a political committee or lobbying
organization
Determine fair value of gifts – actual cost less taxes &
gratuities
Honorariums treated similarly to gifts
See Appendix F for 112, FS
p. 5-8
109
(FAC Section 61H1-21.003)
Prohibits commissions or referral fees with:
o Audits
o Reviews
o Compilations
o Prospective financial data
o Services resulting in an expression of opinion
p. 5-10
110
(FAC Section 61H1-21.003)



CPA must have signed engagement letter with details of
financial arrangements
CPA must hold appropriate licenses
Engagement letter must disclose if not independent
(other than commission or contingent fee)
p. 5-10
111
(FAC 61H1 – 21.005)

Not on services for which commissions or referral fees
could not be accepted

Allowed only on findings of the government - not that of
the licensee

Some exceptions
p. 5-12
112
(FAC 61H1 – 21.006)
If a client of one CPA or firm requests a second CPA or
firm to provide professional advice on accounting or
auditing matters in connection with an expression of
opinion, the second CPA or firm must consult with the
first CPA or firm, after obtaining the client's consent, to
make certain that the (second CPA or firm) is aware of all
the relevant facts.
p. 5-13
113
Competency and
Related Issues
Learning Objectives …
p. 6-1
114




Describe the four general standards of competence
(61H1-22.001)
Apply standards of documentation to the performance of
audits, reviews, and compilations
Describe the purpose of the Clarity Project
Review new amendments to the Code of Professional
Conduct ethics interpretations and rulings
p. 6-1
115

The Florida standards require compliance in four general
areas:
Professional Competence
2. Due Professional Care
3. Planning and Supervision
4. Sufficient Relevant Data
1.
p. 6-1
116
(61H1 – 22.0001)

The AICPA deals with the issue of Competence in its
General Standards, AICPA ET Section 201

The Florida Rules are found in 61H1-22.001,
Competence (General Standards)

Both sets of standards are closely aligned
p. 6-1
117

Agreement to perform implies that the member has
necessary competence to complete the engagement

Member does not assume a responsibility for infallibility
of knowledge or judgment

Competence involves both the member and his/her staff

A CPA must be in charge of all public accounting services
performed by the firm
p. 6-2
118

Assumes the person offering services possess the
“degree of skill commonly possessed” by other persons

Assumes the person exercises that skill with
“reasonable care and diligence”
p. 6-2
119

“A licensee shall adequately plan and supervise an
engagement.”
p. 6-2
120

Obtain sufficient relevant data to afford a
reasonable basis for a conclusion or
recommendations in relation to any professional
services performed
p. 6-2
121

Competence to perform professional services involves:
o The technical qualifications of the member and the member's
staff
o Ability to supervise and evaluate the quality of the work
performed
p. 6-2
122

Competence relates to:
o Knowledge of the profession's standards, techniques and the
technical subject matter involved
o The capability to exercise sound judgment in applying such
knowledge in the performance of professional services
p. 6-3
123
How we may be judged
p. 6-4
124




We will be judged for compliance with the ethical standards
(professional competence, due professional care, planning
and supervision, and sufficient relevant data)
Often these standards may be judged after the situation
has occurred
Those judging us may ask, “Did you…”
We must protect ourselves from perfect hindsight vision
p. 6-4
125
Documentation
Documentation
Documentation
Documentation
Documentation
p. 6-4
126
Documentation requirements are found in many
professional standards:
 Auditing Standards
 Review Standards
 Compilation Standards
 Quality Control Standards
 Attestation Standards
 Other Standards
p. 6-5
127



For our protection, we must understand the general
body of standards to which we will be held accountable
Includes AICPA standards as well as Florida
requirements
Documenting is your best means of defense. Be sure to
document in writing , and in a way that is industry
specific and timely.
p. 6-5
128



AICPA reached significant milestone in Clarity Project with
release of SASs 122-124.
SAS No. 122 contains a Preface and 39 clarified SASs,
effective for periods ending after December 15, 2012
These are effective for audits for periods ending on or after
December 15, 2012.
p. 6-6
129




New report headings
Expanded communications about management’s
responsibilities
Expanded communications about auditor’s responsibilities
Effective for periods ending on or after December 15, 2012
p. 6-7
130

SASs 104-111 have been reissued as part of the Clarity
Project
p. 6-7
131

The disclosure requirements for compilation and review
engagements are generally the same as audits

SSARS 19 requires additional documentation for
compilations and review in the area of “engagement
letters” for periods beginning after December 15, 2010

SSARS 19 allows the reason(s) for the lack of
independence in a compilation engagement

Other new requirements are in SSARS 19
p. 6-7
132
A&A Standards are generally the same as those of the
AICPA
 Other Standards are generally those of the AICPA
 Some standards are not authoritative
 Florida’s assembled financial statements are NOT
recognized by the AICPA
 New standards for local Government audits – Auditor
General Rules

p. 6-7
133
 Independence
o free from personal, external, & organizational impairments
 Professional
Competence
o Professional skepticism, diligence
 Judgment
o Engagement staff must collectively possess adequate
professional competence
p. 6-7
134
The most common areas with deficiencies were:
 Single audit
 Auditor’s reporting
 Audit procedures
 Financial statement deficiencies
 See Appendix B for the report
p. 6-8
135

Framework for independence standards [ET Section 1001.20]
o Definitions of Public Interest and changes to threats

Disclose client info to third parties [ET Sections 92.05 and
391.2]
o Disclosing info without permission is more limited

Members in business [ET Section 92.22]
o Members must follow Code if type of services requires it
p. 6-9
136

Disclose prior employer confidential information [ET
Sections 92.05, 391.2, 501.9]
o Limits member’s disclosure about prior employers

Concept of “financial interest threats” is expanded to
business members [ET Section 100-1.20]
o Now requires members in business to recognize financial
interest threats and safeguards

Expands what is false or misleading acts to all CPAs
[Interpretation 501.10, .11]
o Now applies to members in business
p. 6-9
137

Modifies GAAP for Rule 203 [Interp. 203-5]
o May now use but denote the framework used

Explains when members may withhold records prepared for
clients [Interp. 501-1]
o Members must give client prepared records on request; may
retain if unpaid fees or pending litigation exists

Members may not use misleading firm names
[Interpretations 505-4 and 505-5]
o CPAs should not use misleading firm names
p. 6-9
138
Ethics and Independence
Learning Objectives …
p. 7-1
139



Compare the similarities and differences between Florida
and national rules for Independence
Compare independence standards between the Florida
Board of Accountancy, AICPA, SEC, and Government
Accountability Office
Define the key terms per AICPA’s Professional Standards
ET 92.04
p. 7-1
140


Identify the types of individuals who many impair the
independence of an engagement team
Distinguish when independence is or is not impaired when
providing non-attest services to attest clients per AICPA
Interpretation 101-3
p. 7-1
141

The Florida Legislature

The FL BOA

The AICPA

The PCAOB

The SEC

Yellow Book and/or OMB Requirements

Others
p. 7-1
142

Covered member
o Single Office
o Multi Office

Services performed
o Attest services
o Nonattest services


Client
Relationships
p. 7-2
143

Individual on attest
engagement team

Partner in office of
engagement partner

Individual in a position
to influence

The firm

Firm or commonly
controlled entities

Partner or Manager
providing nonattest
services if…
p. 7-3
144

An engagement that requires independence (ET 92.01)

In Florida, FS 473.315 sets the stage.

Florida has “Standards for Independence”

“A certified public accountant shall not express an
opinion of the financial statements of an enterprise
unless she or he and her or his firm are independent
with respect to such enterprise.”
p. 7-3
145

No opinions unless independent

BOA will adopt rules on independence
p. 7-3
146




The Florida Statutes are very clear on independence and
expressing an opinion
The technical standards for independence are in FAC 61H121-001
61H1-21.001(2) sets out the standards known as
“Standards for Independence” for Florida CPAs
Requires compliance with this Rule
p. 7-4
147
 Rule
101, Ethics Ruling No. 114, “Acceptance or
Offering of Gifts or Entertainment to or from an
Attest Client.”
 Position to influence
 Significance
 Reasonable
p. 7-5
148
“The Code of Professional Conduct was adopted by the
membership to provide guidance and rules to all
members - those in public practice, in industry, in
government, and in education - in the performance of
their professional responsibilities."
Introduction to Code of
Professional Conduct, AICPA
p. 7-5
149



Florida’s “Standards for Independence” has a direct
reference to the AICPA’s Code of Professional Conduct
From the pronouncements, one can assume that if you
are either a member of the AICPA or a licensed Florida
CPA, the provisions for independence will apply
The major question is – apply to which engagements?
p. 7-5
150
Five basic engagements require independence:
1.
2.
3.
4.
5.
p. 7-6
Audit
Review
Compilation
Attestation
Prospective Financial Statements
151




The AICPA’s Ethics Interpretation No. 101-3, states that an
attest engagement is any engagement which requires the
CPA to be independent
Interpretation does not apply to a compilation engagement
which the accountant has modified the report to indicate a
lack of independence
No question that a review engagement or an audit
engagement is an “attest” engagement
In SSARS 19 there is a clear indication that a compilation is
an attest engagement
p. 7-6
152
AR 60
.05 A compilation is a service, the objective of which
is to assist management in presenting financial
information in the form of financial statements without
undertaking to obtain or provide any assurance that
there are no material modifications that should be
made to the financial statements in order for the
statements to be in conformity with the applicable
financial reporting framework. Although a compilation
is not an assurance engagement, it is an attest
engagement.
p. 7-6
153
(FAC 61H1-20.003)
“Client” shall be deemed and construed to mean the
person(s) or entity which retains a licensee for the
performance of public accounting services.”
p. 7-6
154
Internal auditors reporting internally to management
are free from impairment of independence if they are:
 Accountable to the governmental head
 Report results of work to the governmental head
 Located organizationally outside of staff or line
management functions
 Has access to those charged with governance
p. 7-7
155



In a compilation when the accountant is not independent,
the accountant should indicate the lack of independence
SSARS 19 states that the accountant is not precluded from
disclosing a description about the reason(s) independence
is impaired
Disclosing the reason(s) is not required but is optional
p. 7-8
156

“Revised Applicability of Statements on Standards for
Accounting and Review Services”

SSARS do not apply when SAS 100, SAS 116, and SAS
121 apply.
p. 7-9
157
Independence: Non-attest,
Non-audit Services
Learning Objectives …
p. 8-1
158


Describe the implications of the AICPA’s Interpretation
101-3 for nonattest services for attest clients
Describe the independence provisions of Government
Auditing Standards (Yellow Book) relating to nonaudit
services for audit clients
p. 8-1
159




Both AICPA and GAS provide guidance for nonattest
services by an auditor
Nonattest audits must comply with both sets of standards
GAO rules are typically more restrictive
The standards are different, see comparison in Appendix D
p. 8-1
160
 Under
Interpretation 101-3 the independence rules
may come from several authoritative bodies.
o FL BOA
o AICPA
o SEC
o GAO
o Department of Labor
p. 8-2
161

When nonattest services are performed for clients
for which attest services are performed:
o Documentation of understanding with client is
necessary
o The requirements of 101-3 are still being revised
p. 8-2
162
 Clients
must agree to do certain things:
o Make all management decisions
o Designate an employee
o Evaluate adequacy and results
o Accept responsibilities
o Establish and maintain controls
p. 8-2
163
 Member
must establish and document in writing
his/her understanding with the client:
o Engagement objectives
o Services
o Client’s acceptance
o Member’s responsibilities
o Any limitations
p. 8-3
164

Revisions issued by the Professional Ethics Executive
Committee (PEEC)

Revisions are in bookkeeping, internal audit services,
valuation, appraisal, actuarial services, and information
systems design and implementation

Revisions tighten the requirements for documentation of the
member’s understanding with the client regarding the
services to be performed
p. 8-3
165
…do you know
the answer?
p. 8-4
166
Overarching Principles
The auditor should not provide nonaudit
services that involve performing management
functions or making management decisions.
2. The auditor should not audit his/her own work
or provide nonaudit services in situations
where the nonaudit services are
significant/material to the subject matter of the
audit.
1.
p. 8-8
167
 Bookkeeping
and preparing accounting records
 Preparing financial statements
 Internal audit services
 Internal control and monitoring and
assessments
 Information technology systems services
 Valuation services
p. 8-8
168

Differences between the AICPA Code of Professional Conduct
and Government Auditing Standards include:
o Post-impairment period
o GAO standards – “structural threat”
o Subject external consultants and specialists to both
independence standards and the assessment of
independence
o Contain guidance on documentation necessary to
support adequate consideration of auditor
independence
p. 8-9
169
Privileged Confidentiality,
Communication, and Other
Considerations
61H1-23 FAC
Learning Objectives …
p. 9-1
170




Describe “privileged communication” between a CPA and
client under Florida statutes and rules
Describe the disposition of client records per national and
Florida rules
Define the term “client record” (AICPA 501-1)
Describe the implications to the CPA of verifying a “comfort
letter”
p. 9-1
171



Describe what is permissible in regards to advertising and
solicitations of clients per national and Florida rules
Describe the various forms of practice available to a
licensee (61H1-26.001)
Explain how a practice can be named and share office
space (61H1-26.001)
p. 9-1
172
(473.316, FS)
(1)(c) A communication between an accountant and client is
“confidential” if it is not intended to be disclosed to third
persons …
(1)(d) A “quality review” is a study, appraisal, or review … conducted
by a professional organization for the purpose of evaluating
quality assurance required by professional standards,
including a quality assurance or peer review
p. 9-1
173
(2) A client has a privilege to refuse to disclose, and to
prevent any other person from disclosing, the contents of
confidential communications with an accountant … This
privilege includes other confidential information obtained
by the accountant from the client for the purpose of
rendering accounting advice.
(3) The privilege may be claimed by … the client, guardian,
personal representative, representative of an
organization/ corporation/ association, or the accountant,
but only on behalf of the client.
p. 9-1
174
(4) There is no accountant-client privilege under this section when:
(a) The services were sought or obtained to commit a crime or
fraud.
(b) A communication is relevant to an issue of breach of duty by
the accountant to their client or by the client to their
accountant.
(c) A communication is relevant to a matter of common interest
between two or more clients
(5) Communications are not privileged from disclosure in any
disciplinary investigation or proceeding
p. 9-2
175
(6) The proceedings, records, and workpapers of a review
committee are privileged and are not subject to … legal process
or to introduction into evidence in a civil action or arbitration,
administrative proceeding, or state accountancy board
proceeding. A member of a review committee or person who was
involved in a quality review may not testify … Public records and
materials prepared for a particular engagement are not
privileged merely because they were presented during the
quality review.
p. 9-2
176
FAC 61H1-23
Two responsibilities:
 Confidential client information

Records disposition responsibility
p. 9-3
177

CPAs may not disclose any confidential information
obtained in the course of a professional engagement
without the consent of the client.

Implies active and stored information

Peer Review is excluded
p. 9-3
178
Confidentiality includes:
 Office situations

Storage in and away of client data

Other situations
p. 9-3
179
(61H1-23.002)
(1) A certified public accountant shall furnish to a client or
former client within a reasonable time after
request of the document the following if they are in the
certified public accountant's possession or control at the time
of the request. Any accounting or other records belonging to
the client which the certified public accountant may have had
occasion to remove from client's premises, or to receive for
the client's account, including records prepared as part of the
service to the client which would be needed to reconcile to
the financial statements or tax return prepared and issued by
the certified public accountant.
p. 9-4
180
(61H1-23.002)
(2) This rule shall not preclude a licensee from making
reasonable charges for costs incurred. A certified
public accountant shall not withhold those items
contemplated above under any circumstances following a
demand for same from the client.
(3) Provisions of this rule apply
to Licensed Audit Firms
and to all certified public accountants practicing
public accounting.
p. 9-4
181

If the tax return or financial statement has not been
issued, the CPA must only return records received from
the client, but this shall not preclude the licensee from
making copies of such documents when same form the
basis of work done by the CPA.
p. 9-4
182
The revised interpretation:

Defines key terms

Makes interpretations of how to respond to client requests.
p. 9-5
183

Requests from banks, financial institutions, and
mortgage companies to verify financial information for
a client

The risk in responding is significant

How should CPAs respond to these requests?
p. 9-7
184
“any public record made or received in connection with
the official business of any public body, officer, or
employee of the state, or person acting on their behalf
unless there is a specific exemption.” Article I, Section
24 (a), Florida Constitution (1968)
p. 9-12
185

Found in ET Section 502 – “Advertising and Other
Forms of Solicitation”

Florida rules generally follow the AICPA rules
p. 9-13
186
(61H1-24.002)

Licensee may reply to requests for proposals

Must adhere to rules for advertising, both oral and
written
p. 9-14
187

Licensees may not allow others to do things the CPA
themselves may not do

This includes situations for compensation and not for
compensation
p. 9-15
188

Names, terms, branch offices (61H1-26)

Forms of practice and name shared office space
(61H1-26.001)

Minimum capitalization /adequate public liability
insurance (61H1-26.002)

Financial statements of the firm
p. 9-15
189
p. 9-17
190
Code of Ethics for
Public Officers and
Employees (s. 112 F.S.)
Learning Objectives …
p. 10-1
191
Review definitions regarding applicability
 Review standards of conduct
 Review restrictions on employment of relatives
 Review voting conflicts
 Review penalties

p. 10-1
192
Agency
 Breach of public trust
 Conflicts of interest
 Gift
 Purchasing agent
 Relative

 See
s. 112, Part III, Definitions
p. 10-2
193
 Solicitation
or acceptance of gifts
 Doing business with one's agency
 Conflicts of employment or contractual
relationship
 Unauthorized compensation
 Misuse of public position
 Exemptions and other issues
 Disclosures or use of certain information
p. 10-3
194
Future Implications
Learning Objectives …
p. 11-1
195



Name several changes to the accounting profession that
could occur within the next 10 years
Highlight several major differences between the IFAC and
AICPA ethics codes of conduct
Discuss aspects of the CPA Horizons 2025 Project
p. 11-1
196
To prophesy is extremely difficult
… especially with regard
to the future

p. 11-1
Chinese Proverb
197
Where is the CPA profession going?
p. 11-1
198
Changes previously talked about have happened:

Most VERY large audits will be performed by the
“Quadropoly”/“Final Four”

XBRL – bar coding of financial statements

Accounting Standards Codification

Mobility
p. 11-1
199

The AICPA and IFAC have begun to converge the IFAC’s
Code of Ethics for Professional Accountants and the
AICPA’s Code of Professional Conduct

In 1917, the AICPA’s predecessor adopted eight rules of
conduct (one sheet of paper)

The rules evolved and were codified in 1973 into the
current AICPA’s Code of Professional Conduct
p. 11-1
200

100 years – and many sheets of paper later – the AICPA
Code and related guidance is ripe for reorganization

The standard setting organizations in more than 100
countries have adopted the IFAC’s Code of Ethics; many
others are in the process of converging with the code

The code will impact those in public practice, business,
academia, and government
p. 11-2
201

The IFAC code uses a conceptual framework approach to
evaluate relationships or circumstances that raise ethical
issues

The AICPA’s and the IFAC’s codes address similar issues:
o Independence
o Objectivity
o Due care
o Confidentiality
p. 11-2
202
The AICPA Project, CPA Horizons 2025, sought the insights of
5,600 CPAs on current and future trends that will impact the
profession and the world of CPAs.
10 key themes emerged that give insight into the profession:
o Conducting and will conduct business
o Serve clients and employers
o Attract and retain employees and new business
o Remain competitive in the marketplace for the next 15 years
p. 11-5
203
 Understand
and leverage relevant
technology in conjunction with core CPA
competencies to deliver superior services
p. 11-5
204
IMPACT ON THE PROFESSION
 Stay current with, embrace and exploit technology for
increased efficiency and expansion of services
 Find solutions to offer investors and stakeholders up-todate, real-time financial information and to increase
transparency
 Embrace mobile technologies and social media
 Fraud may be easier to commit and more difficult to
prevent and detect
p. 11-5
205

Evolve the educational framework to keep
pace with the changing dynamics of business, government
and our profession
p. 11-6
206
IMPACT ON THE PROFESSION
 Devote time to staying current with regulations and
standards, and worldwide trends
 Further develop interpersonal skills to enhance
relationships
 Embrace real-time learning in the workplace to learn and
adapt quickly and knowledgeably
 Requirements for new CPAs must remain rigorous and
demanding and be practical and relevant
 New CPAs must have a broad knowledge of business and
soft skills and not simply focus on technical accounting
p. 11-6
207

Position the CPA as a premier
designation of the accounting and finance
profession throughout the world
p. 11-6
208
IMPACT ON THE PROFESSION
 Be increasingly aware of international business issues and
trends
 Assess the trend toward outsourcing overseas and create
opportunities to expand services to serve these markets
 Continue to market the quality and value of their services to
expand and thrive globally
p. 11-6
209

Encourage pride among CPAs in the
CPA profession and in the value CPAs create
throughout society
p. 11-6
210
IMPACT ON THE PROFESSION
 The profession must continue to advocate on behalf of
itself to ensure continued recognition as a trusted advisor
 Uphold the integrity of the profession and maintain high
standards in an ever-changing environment and in cultures
where business practices differ from U.S. practices
p. 11-6
211

Preserve the role of the CPA as the
trusted attester of financial and other information
p. 11-6
212
IMPACT ON THE PROFESSION
 The profession must stay vigilant in defending its unique
role as providers of audit and attest services
 All CPAs benefit from the public trust rooted in the
provision of audit and assurances services
 Audit and attest functions must evolve to meet changing
regulatory demands and client and business needs
p. 11-6
213

Promote the CPA as the trusted
advisor who provides core CPA services and
develops solutions to complex business problems
p. 11-6
214
IMPACT ON THE PROFESSION
 Continue to evolve as strategic partners of clients,
business and employers, applying multidisciplinary and
integrated problem solving to expand traditional services
and enhance nontraditional offerings and the perception
of trusted advisor
p. 11-7
215

Leverage the strengths of the
profession to expand market permissions
p. 11-7
216
IMPACT ON THE PROFESSION
 Emerging opportunities for specialization will allow CPAs
to strengthen their expertise and provide additional
value to clients, employers and business
 Continue to evaluate which services are offered locally
and globally and how to deliver these services to adapt
to the needs of clients, employers and business
p. 11-7
217

Address continual changes in the
marketplace, economy, businesses and regulations
p. 11-7
218
IMPACT ON THE PROFESSION
 The nature of the work that CPAs perform must evolve to
respond to shifts in business, society and technology
 Changes will offer opportunities to enhance the value of
CPA services
 Lifelong learning will take on greater importance as a
way for CPAs to stay up-to-date
p. 11-7
219

Increase the visibility of the
profession’s value proposition by
demonstrating the profession’s Core Values in multiple
areas of business and society
p. 11-7
220
IMPACT ON THE PROFESSION
 By listening to and understanding the needs and
challenges of employers and clients, opportunities for
CPAs to develop services that align with Core Values will
emerge
 The profession must spend more time demonstrating
their value to clients, businesses and the public about
the role and value of the CPA in order thrive amid
increased competition and economic pressures
p. 11-7
221

Continue to offer opportunities that
enhance the appeal of the profession and be proactive
in addressing both U.S. and global demographic shifts
p. 11-8
222
IMPACT ON THE PROFESSION
 Strive to reflect the demographic shifts of incoming
accounting students, clients, business and society
 Programs offered to support minorities, women and
young CPAs in the workplace must be more widely
implemented
 Experienced and older CPAs must continue to mentor
young CPAs and identify leadership and advancement
opportunities
p. 11-8
223


Increase flexible work arrangements and work-at-home
options
Continue to support and enhance programs that build
awareness of the CPA profession to young audiences
p. 11-8
224
p. 11-17
225




It is a small world after all — every business is becoming a
global business
The future is here — embracing the future now will ensure
viability in the long run
Change is inevitable — technology already is changing the
way we work … and the change will continue
Generations are working side by side — Baby Boomers are
not retiring and Millennials are bringing a new set of skills
and ideals to the workplace
p. 11-8
226




Be open to change — embrace, don’t fear, the future
Be nimble — adapt traditional services and establish new
ones to take advantage of change
Be collaborative — work with each other and with the global
community to shape and execute the standards and
services that will emerge over the next decade
Be forward-thinking — assess and evaluate the current and
future environments and plan accordingly
p. 11-8
227



Technology: Address security and privacy concerns; adapt
traditional services; utilize state-of-the-art tools to reach
out to new markets
Education: Balance judgment with technical skills; teach
soft skills; stay ahead of the curve on regulations and
standards
Globalization: Understand international issues, trends,
standards and regulations; identify new markets; explore
new job opportunities
p. 11-8
228



Promotion: Market the profession’s virtues of integrity,
objectivity and trust to local, national and international
audiences
Collaboration: Understand the different perceptions and
realities of the generations and find ways to bridge the gap
and take advantage of the best each can offer
Integration: Review our competencies and align them with
new realities; enhance our role as a business advisor
p. 11-8
229


Adaptation: Address changes in the marketplace,
economy, business and regulations; immerse ourselves in
domestic and international trends
Competition: Understand the numerous choices available
to clients and employers; market the CPA value
p. 11-9
230
Welcome to the future!
p. 11-9
231

Remember that for over 100 years the profession of
certified public accountants have been kept at the top of
the ethical list for the professions with:
o Honesty
o Trustworthiness
o Integrity
o Objectivity
p. 11-9
232
Our professional ethics
p. 10-18
233
for your attention today …!
p. 11-9
234