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Copyright © 2007 Thomas Chenoweth
(239) 671-2314


4 Articles


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AICPA Code’s rule on confidentiality trumps the Utilitarian principle. Author looks at Utilitarian principle, Rule deontology, and Kohlberg’s moral development model. Three hypothetical attest case studies: net income underreported on prior year tax return, product safety, and conflict of interest as bank director. (Confidentiality Decisions: The Reasoning Process of CPAs in Resolving Ethical Dilemmas, Barbara L. Adams, Fannie L. Malone, and Woodrow James, Journal of Business Ethics, 1995, Vol. 14, pp. 1015-1020.)

Auditors of distressed businesses who have low ethical reasoning skills will alert friends and other clients of potential harm. (The Impact of Guanxi on the Ethical Decision-Making Process of Auditors—An Exploratory Study on Chinese CPAs in Hong Kong, Alan K.M. Au and Danny S.N. Wong, Journal of Business Ethics (2000), Vol. 28, pp. 87-93.)


Auditors should observe the AICPA confidential client information rule unless the client is perpetrating fraud. Two court decisions against accounting firms. (Code of Ethics: The Professional Catch 22, John E. Beach, Journal of Accounting and Public Policy (1984), Vol. 3, pp. 311-323.)

CPAs cannot disclose confidential client information (illegal acts) to the public without the client’s permission in order to preserve a trusting environment where the client feels free to make full disclosure to the CPAs. CPA firms should not form limited liability partnerships or limited liability corporations to protect themselves from audit failure lawsuits; otherwise, the Securities and Exchange Commission will regulate the accounting profession. Non-audit services jeopardize the CPA firm’s independence. (A Critical Examination of the AICPA Code of Professional Conduct, Allison Collins and Norm Schultz, Journal of Business Ethics (1995), Vol. 14, pp. 31-41.)