Audit and Taxation Practice: AICPA and IRS Rules in the USA Context

This assignment delves into the critical aspects of audit and taxation practice, specifically focusing on the rules and regulations set forth by the American Institute of Certified Public Accountants (AICPA) and the Internal Revenue Service (IRS) within the United States. The discussion highlights the importance of maintaining client confidentiality, as mandated by Section ET 301 of the AICPA's Code of Professional Conduct, and the necessity for auditors to uphold independence, integrity, and objectivity, as outlined in Section ET 100. Furthermore, the assignment clarifies the IRS's stance on income tax return filing, emphasizing that it is a mandatory requirement, not a voluntary one, as per Section 6011(a), and the obligation to file if income exceeds statutory limits, according to Section 6012(a). The relevance of these rules is underscored by the provided references, which support the importance of adhering to these guidelines to ensure the quality of auditing and proper tax compliance. Overall, this assignment showcases the legal and ethical framework governing auditing and taxation practices in the USA.

Running head: AUDIT & TAXATION PRACTICE
Audit & Taxation Practice
Name of the Student:
Name of the University:
Authors Note:

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AUDIT & TAXATION PRACTICE
Contents
Discussion:.......................................................................................................................................2
AICPA rules:...............................................................................................................................2
IRS rules:.....................................................................................................................................3
References:......................................................................................................................................4

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Discussion:
AICPA rules:
Section ET 301:
Section ET 301 of Code of Professional Conduct and Bylaws states the law in relation to the
confidentiality of client information. The auditors, i.e. qualified accountants are under obligation
not to disclose the confidential information of the clients. An auditor generally comes across
number of sensitive information during the course of conducting audit of a client. The auditor is
responsible to maintain confidentiality of such information. The auditor except when needed by
the statue is expected to not disclose any of such information without the knowledge and
permission of the client on any platform.
Section ET 100:
Section ET 100 of the act discusses the concept of independence, integrity and objectivity of
auditors in audit of financial statements. The conceptual framework of AICPA discusses the
standards in relation to independence auditors. As per the law it is absolutely essential for an
auditor to be independent while discharging his duties and responsibilities as an auditor. A CPA
also expected to maintain integrity and objectivity during the course of auditing. The quality of
audit will be hampered significantly in case the auditor has any interest attached with the
company that is being audited (Stanko & Knoblett, 2018).
The relevance of both the above rules in auditing in the United States of America is extremely
significant to the quality of auditing. Thus, an auditor must be independent and maintain the

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confidentiality and integrity of information of the client hat he or she obtains during the course of
auditing.
IRS rules:
Section 6011 (a):
Section 6011(a) of Internal Revenue Service (IRS) clearly state that the income tax return filing
requirement is not a voluntary requirement. In fact the use of the word voluntary in many
publications of Flora and IRS publications have been made to indicate that the taxpayers are
allowed to determine correct amount initially to complete income tax return filing. Thus, it tax
payers are under obligation to file income tax return and it is not voluntary as per the rules and
codes of IRS (Thorndike, 2017).
Section 6012 (a):
As per section 6012(a) any person who has received an amount in excess of statutory amount are
under obligation to file income tax returns. The section further states that non-filing of income
tax return by a person who has received income in excess of statutory limit will be subjected to
civil and/ or criminal penalties. Thus, it is compulsory to file income tax return on or before the
due date to avoid penalties.
It is clear from the above discussion that the relevance of rules and laws made by AICPA and
IRS are extremely crucial to the respective professionals to ensure that auditing and income tax
return provisions are followed properly (Stanko & Knoblett, 2018).

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References:
Desai, R., & Roberts, R. (2017). Deficiencies in the Code of Conduct: The AICPA Rhetoric
Surrounding the Tax Return Preparation Outsourcing Disclosure Rules. Journal Of Business
Ethics, 115(4), 457-471. doi: 10.1007/s10551-012-1329-z
Stanko, B., & Knoblett, J. (2018). AICPA rules of conduct and practitioner
knowledge. International Advances In Economic Research, 2(3), 164-172. doi:
10.1007/bf02295972
Thorndike, J. (2017). Reforming the Internal Revenue Service: A Comparative History. SSRN
Electronic Journal, 2(2), 15-35. doi: 10.2139/ssrn.2264867