1) Ethics Committee Raymond N. Johnson, CPA, Ph.D., Chair 

2) ETHICS ALERT What’s Coming Over The Horizon 

3) 3 Transfer and Return of Client Records ● Confidentiality when reviewing or acquiring a member’s practice ● A member’s responsibility when a practice is sold or transferred ● A member’s responsibility when a practice is discontinued ● The responsibility of a member who acquires a practice 

4) 4 Transfer and Return of Client Records ● The Conundrum: What to do when a member (licensee) become incapacitated or dies. 

5) 5 Definition of a Client ● Under discussion: The client should be the person or entity that engages the member ● This would not include a target entity that does not engage the member ● Definition of attest client – not necessarily a subset of definition of a client. 

6) 6 Definition of a Client ● Will address members in governmental audit organizations ● Will address disclosure of confidential information related to a non-client (e.g. target entity) in definition of attest client. 

7) 7 Information Technology and Cloud Services ● Addressing the self-review and management participation threats when a member provides hosting services to an attest client 

8) 8 Commissions and Contingent Fees  Considering the need to revise the Code to expand the prohibition of acceptance of commission or contingent fees to all attest clients.  Addressing whether any additional safeguards are needed (e.g., written disclosure) 

9) 9 AICPA Codification / State Board Rule Review ● Recent PEEC Questionnaire to State Boards on Client Records 

10) 10 Independence: Entities Included in State and Local Government Financial Statements  Determine if a conceptual framework assessment could be utilized to determine when a member needs to be independent of state and local government entities for which he or she is not providing financial statement attest services. 

11) 11 Non-Compliance with Laws and Regulations (NOCLAR) ● International Ethics Standards Board for Accountants ● 4 Categories ● ● ● ● Auditors Other Professional Accountants in Public Practice Senior Professional Accountants in Business Other Professional Accountants in Business 

12) AICPA Code of Conduct • 19 States have adopted the AICPA Code of Professional Conduct • ENGAGE A DISCUSSION about whether your state board should adopt the AICPA Code of Professional Conduct 

13) QUESTIONS?