Sample Exceptional Evaluation Level Discussion Board Responses Examples Example One: Discussion Board Reply on ethics, integrity, and objectivity of Clara Case Scenario Clara Case Scenario Discussion Board Reply Post 1:
Under Circular 230, CPA Charles does not have a responsibility to inform the widow that she is being significantly overcharged by the attorney. According to Circular 230, the responsibility of a CPA is limited to providing accurate and complete advice on tax matters to their clients. There is no requirement for the CPA to inquire about the fee arrangements between the attorney and the client. However, if CPA Charles believes that the fee charged by the attorney is unreasonable or excessive, he may consider discussing the matter with the attorney or the client.
One potential ethical issue in this situation is the attorney charging an excessive fee of 17 percent for handling the estate, which is significantly higher than the normal charge of 3 to 5 percent. This may be seen as taking advantage of a vulnerable client who is relatively unsophisticated in financial matters. Additionally, the attorney hired CPA Charles for $10,000 to compute Phil’s estate tax, which seems to be a high fee for such a service.
The AICPA Code of Professional Conduct rule that applies in this situation is Rule 1.130, which states that a member should not subordinate his or her judgment to that of others or impair his or her integrity by virtue of association with a client. This rule requires the attorney to exercise independent professional judgment and not compromise their integrity in association with the client.
One relevant Biblical principle in this situation is Proverbs 11:1, which states, “The Lord detests dishonest scales, but accurate weights find favor with him.” This principle emphasizes the importance of honesty and integrity in financial matters and may apply to the attorney’s excessive fee arrangement.
Clara Case Scenario Discussion Board Reply Post 2:
CPA Charles does not have a responsibility to inform the widow that she is being significantly overcharged by the attorney under Circular 230. However, the AICPA Code of Professional Conduct requires members to act with integrity and objectivity and to communicate with clients in a timely and effective manner. If CPA Charles believes that the attorney’s fee arrangement is excessive, he should discuss the matter with the attorney or the client to ensure that they understand the implications of the fee arrangement.
The attorney’s decision to charge the widow 17 percent for handling the estate may raise ethical concerns about fairness and objectivity. The attorney is taking advantage of the widow’s unsophistication in financial matters and charging an excessive fee that is significantly higher than the normal charge for such work. Additionally, the attorney’s decision to hire CPA Charles for $10,000 to compute Phil’s estate tax seems to be a high fee for such a service.
The AICPA Code of Professional Conduct rule that applies in this situation is Rule 1.110, which requires members to maintain objectivity and integrity in their professional services. This rule emphasizes the importance of being honest and transparent with clients and avoiding conflicts of interest.
One relevant Biblical principle in this situation is Proverbs 16:11, which states, “Honest scales and balances belong to the Lord; all the weights in the bag are of his making.” This principle emphasizes the importance of fairness and honesty in financial matters and may apply to the attorney’s excessive fee arrangement.
Clara Case Scenario Discussion Board Reply Post 3:
I agree with the previous posts that Circular 230 requires Charles to inform the widow if he believes that the attorney’s fee is excessive. It is important to note that the Circular provides guidance on the ethical and professional standards that must be followed by tax practitioners in their practice before the Internal Revenue Service (IRS). Circular 230, Section 10.21(a) states that a practitioner must not charge an unconscionable fee for their services. Therefore, Charles must inform the widow about the high fee charged by the attorney.
From an ethical perspective, the attorney’s decision to charge an excessive fee may be seen as a conflict of interest. AICPA Code of Professional Conduct, Rule 102-2, states that members should not be associated with information that they know or should know is materially false or misleading. In this case, the attorney’s decision to charge such a high fee may be seen as materially false or misleading, which may lead to a lack of trust and a negative reputation for the profession.
The AICPA Code of Professional Conduct, Rule 102-4, also applies in this situation, as it requires members to act with integrity, objectivity, due care, and professionalism when providing services to clients. By charging an excessive fee, the attorney may be seen as violatin