AICPA, Compliance Letter and Services, Complied Financial Statements, and Web Trust Services

Discussion Questions
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Response to question 1
The American Institute of Certified Public Accountants (AICPA) stipulates rules as well as standards for the Certified Public Accountant profession in 5 key areas. These include (i) auditing standards; (ii) review and compilation standards; (iii) other attestation standards; (iv) consultation standards pertaining to consulting services offered by Certified Public Accountants; and (v) code of professional conduct (American Institute of CPA, 2014). The most important of these standards is the code of professional conduct primarily because it focuses on ethics and gives emphasis on the importance of proper ethical conduct by CPAs. The code of professional conduct is particularly important than the other four standards since it provides vital guidance on the public interest, professional responsibilities, objectivity, integrity, confidentiality of client information, independence of CPA firms and auditors, and due care (American Institute of CPA, 2014).
Response to question 2
Debt compliance essentially describes several legal measures which are undertaken to make sure that debtors honor their debts and make a candid effort in repaying the funds which they owe. Clients at times enter into loan agreements requiring them to give the lender a report from an auditor or a certified public accountant as to the nonexistence or existence of some condition (Dunn, 2014). A debt compliance letter is a report that a client provides to the lender regarding the existence or nonexistence of some condition; the letter is prepared by a CPA firm and given to the client who will then provide it to the lender (Dunn, 2014). A debt compliance letter is, in essence, addressed to the financial institution of the creditor. It is necessary to conduct an audit of a company before it is acceptable to issue a debt compliance letter in order to determine if the client has actually repaid all its debts or has made honest efforts to repaying the funds that they owe (Dunn, 2014).
Response to question 3
Compiled fiscal statements are essentially the most basic level of service that a Certified Public Accountant can offer regarding financial statements. In a compilation engagement, the CPA generally helps the client or the entity’s management to present fiscal information in the form of fiscal statements without agreeing to provide or obtain any assurance that there are no material modifications which have to be made to the fiscal statements (Certified General Accountants, 2014). A compilation engagement does not require the accountant to perform inquiry, analytical procedures, or other procedures which are normally carried out in a review. Moreover, a compilation also does not require the CPA to gain an understanding of the client’s internal control, assess fraud risk, or test accounting records, or other procedures that are usually carried out in an audit (Certified General Accountants, 2014). The accountant will issue a report that states the compilation was carried out compliant wi...