[jeff]

Welcome to the Q4 2016 CPA Exam Study Group for REG.

If this is your first post in the study group – please post your target exam date (just the time frame to preserve your anonymity), and your past history with this exam (optional, of course).

Jeff Elliott, CPA (KS) | Another71 | NINJA CPA | NINJA CMA | NINJA CPE

[Reg_Slayer]

yea, i understand what it is. but not off the top of my head when it is needed.

EDIT:

“Because you “know” the bank will be relying on those financial statements, the bank has “privity” with you, the CPA, if the client goes bankrupt.”

i think in that case, the bank and the client would be in privity, but the bank and CPA would not be in privity.

EDIT 2:

So CPA can use “lack of privity” as a defense, and be off the hook if the client fails to pay up.

[jonm857]

actually, I think it's needed when a creditor wants to sue an accountant for negligence. the defense has to prove there was no privity or that the accountant performed his duty of care. it has to be negligence because if it were fraud, it wouldn't matter if there was privity. anybody could recover.

B - 81
A - 87
R - 73
F - July 5th

[Reg_Slayer]

bingo. back in 20.

[jonm857]

screw C-Corps. I'm going after estates and trusts.

B - 81
A - 87
R - 73
F - July 5th

[jonm857]

Actually, screw estates & trusts too, I am now going after individual tax.

B - 81
A - 87
R - 73
F - July 5th

[Reg_Slayer]

r5 4 me

[jpowell31]

i think it'll actually state under the ultrimares rule for privity to be required as most states have adopted the majority rule/foreseeable parties.

[jpowell31]

is the foreign tax credit carried back one year and forward 10 or back 2 years but it may be a typo. i have conflicting notes and thought it was 1/10?

[aatoural]

carried back 1 year and forward 10 yrs

BEC - PASSED
AUD - 8/29/16
FAR - TBS
REG - TBS

[aatoural]

According to Becker

BEC - PASSED
AUD - 8/29/16
FAR - TBS
REG - TBS

[aatoural]

https://www.irs.gov/taxtopics/tc856.html

just in case the second to last paragraph states it as well.

BEC - PASSED
AUD - 8/29/16
FAR - TBS
REG - TBS

[Reg_Slayer]

@jpowell31

MINORITY rule / Ultramares rule = needed privity or to have been intended 3rd user to prevail in lawsuit

vs

majority rule = only need to have been a foreseeable user to prevail in a lawsuit.

^ do you agree with that?

but then can this lawsuit be for fraud..constructive fraud….gross negligence….ordinary negligence..? and [sect. 11 (1933)] and [10-b(5) 1934] have their own rules as well ?

?????

[jonm857]

https://www.youtube.com/watch?v=yxurvsjFDMg

B - 81
A - 87
R - 73
F - July 5th

[jpowell31]

yes i agree. fraud trumps everything (no need for privity). i just remembered i can't skip family dinner tonight since my family is away and it's just me and my grandmother and we have to keep checking on her.. there goes 2 hours of studying out the window…and speaking of windows, i found out my car got broken into last night. WTF. seriously the gods know when i'm about to sit an exam, the most random things come up the week before.

i was just getting into a solid groove this AM. almost fully done individual review. then will do 75 questions and SIMs. then onto corp/entities which will take a bit longer as i want to do some comparatives so likely will be my day. fitting in visits from the internet company and security company and doing errands. #slightlyannoyed #alwayslookingforanexcuse #imnotsurehowhashtagswork

[jonm857]

@jp

sorry to hear about your car getting broken in…. that sucks

B - 81
A - 87
R - 73
F - July 5th

[Author]

Replies