[rknight21]

ok below is a sample question that cpaexcel emailed me…. to me the answer is B and i am almost certain.. can someone confirm for me whether it is B or D as cpaexcel says… If its really B i have to say i am glad i didnt purchase this review course

To which of the following do the AICPA independence rules not apply?

A. An audit or review of financial statements;

B. A compilation of financial statements expected to be used by third parties; or

C. An examination of prospective financial information

D. Preparation of financial returns for the client’s use without preparing a report thereon.

The correct answer is D.

A. Incorrect… Audits and reviews are examples of attest work and therefore are covered by the independence rules.

B. Incorrect… A compilation of financial statements expected to be used by third parties is an example of attest work and therefore is covered by the independence rules.

C. Incorrect… An examination of prospective financial information qualifies as attest work and therefore is covered by the independence rules.

D. Correct! Preparation of financial returns for the client’s use without preparing a report thereon, much less an audit, is not attest work and is not covered by the independence rules.

[jbeans2009]

independence rules still apply to compilations-although you may do a compilation while not independent-but must state that.

[Anonymous]

The answer is D because all you are doing is “bookkeeping” work.

[Anonymous]

Just to be absolutely 110% certain, we checked: the answer is D.

The professor mentor who responded within 24 hours explained it this way:

“The other three answers are all attestation which requires independence but D is not attestation. What is probably confusing people is that compilations normally do not require independence. When they add wording concerning it being used by a third party, it changes it.”

–Your Friends at CPAexcel

[Author]

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