As of January 24, 2014

Create user friendly, intuitively arranged Code
Revise without making significant changes to existing requirements and restrictions
• Clarity through better drafting conventions
• Substantive changes will follow due process
Incorporate conceptual framework approach
• Incorporate threats and safeguards
• Conceptual framework only applies when no guidance in Code exists
• Cannot be used to override existing requirements

Incorporate references to division’s nonauthoritative guidance
Physically different – Separate parts
Part 1: Members in public practice
Part 2: Members in business
Part 3: All Other Members
On-line Codification with enhanced functionality
Project Page on aicpa.org. Contains information such as:
• Mapping Documents
• Informational Video and articles
• Project Timeline
• Drafting Guidelines www.aicpa.org/InterestAreas/ProfessionalEthics/Community/Pages/ aicpa-ethics-codification-project.aspx

AICPA Ethics Codification

Two New Frameworks
• Conceptual Framework for Members in the Practice of Public
Accounting
• Conceptual Framework for Members in Business
Applied when no guidance on a particular relationship or circumstance
Violation of applicable Rule
• If the member cannot demonstrate that safeguards were applied that eliminated or reduced significant threats to an acceptable level

Ethical Conflicts
Definition of Attest Client
Loans and Lending Institutions
Blind Trusts
Expanded Application
• Self-Review Treat
• Director Positions
• False, Misleading or Deceptive Acts
• Billing for a Subcontractor's Services
• Attest Engagement Performed with Former Partner
• Use of AICPA Awarded Designation

Nothing on Point in the Code
• Old Thinking
 Relationship or circumstance must be permitted
• Revised Thinking
 Apply the conceptual framework
Requires professional judgment
• Reasonable Third Party
- For example, if the situation involves a staff person often an effective safeguard is:
- The staff's removal from the engagement
Additional review of the staff’s work

Step 1
Identify
Threats
No
Threats
Proceed
Step 2
Evaluate
Threats
Threats not
Significant
Proceed
Threats
Not Acceptable
Level…Stop
Step 3
Identify
Safeguard s
Existing New
Step 4 Evaluate
Safeguards
Threats at
Acceptable
Proceed

Characters
• Anthony “Auto” – Owner of Used Car Dealership
• Evan – Owner of a CPA Firm (and Thomas’ brother)
• Robert – Owner of Auto Supply Store and über mechanic
(childhood friend of Auto and Evan)
Situation
• Can Evan perform reviews for Robert’s store?

A.
Not perform the attest engagement
B.
Discuss the threat with those charged with governance
C.
Apply safeguards that eliminate or reduce the threat to an acceptable level
D.
Adopt policies and procedures that are designed to monitor the quality control of the attest engagement

A.
Yes
B.
No

AICPA Ethics Codification

Appears in boxed text at the end of the applicable topic, sub-topic or section. For example:
Appraisal, Valuations, and Actuarial Services for Nonfinancial Statement
Purposes
.06 Threats would be at an acceptable level, if a member provided appraisal, valuation, or actuarial services solely for nonfinancial statement purposes, such as appraisal, valuation, and actuarial services performed for tax planning or tax compliance, estate and gift taxation, and divorce proceedings. Accordingly, independence would not be impaired. [Prior reference: paragraph .05 of ET section 101]
Nonauthoritative answers to FAQs regarding appraisal, valuation, and actuarial services are available at www.aicpa.org/InterestAreas/ProfessionalEthics/Resources/Tools/
DownloadableDocuments/NonattestServicesFAQs.doc

AICPA Ethics Codification

Preface
0.100.000 Overview of the Code of Professional Conduct
0.200.000 Structure and Application of the AICPA Code
0.300.000 Principles of Professional Conduct
0.400.000 Definitions
0.500.000 Nonauthoritative Guidance
0.600.000 New, Revised, and Pending Interpretations and Other
Guidance
0.700.000 Deleted Interpretations and Other Guidance
Part 1
Part 2
Part 3

1.000 INTRODUCTION
1.100 INTEGRITY AND OBJECTIVITY
1.200 INDEPENDENCE
1.300 GENERAL STANDARDS
1.310 COMPLIANCE WITH STANDARDS
1.320 ACCOUNTING PRINCIPLES
1.400 ACTS DISCREDITABLE
1.500 FEES AND OTHER TYPES OF REMUNERATION
1.510 CONTINGENT FEES
1.520 COMMISSIONS AND REFERRAL FEES
1.600 ADVERTISING AND OTHER FORMS OF SOLICITATION
1.700 CONFIDENTIAL INFORMATION
1.800 FORM OF ORGANIZATION AND NAME

1.210 Conceptual Framework
Approach
1.220 Accounting Firms
1.224 Affiliates, including
Governmental Units
1.226 Reissued Reports
1.228 Engagement Contractual Terms
1.230 Fees
1.240 Financial Interests
1.245 Trusts and Estates
1.250 Participation in Employee
Benefit Plans
1.255 Depository, Brokerage and
Other Accounts
1.257
Insurance Products
1.260 Loans, Leases, and Guarantees
1.265 Business Relationships
1.270 Family Relationships with Attest
Clients
1.275
Current Employment or Association with an Attest Client
1.277
Former Employment or Association with Attest Client
1.279
Considering or Subsequent
Employment or Association with
Attest Client
1.280 Memberships
1.285
Gifts and Entertainment
1.290 Actual or Threatened Litigation
1.295 Nonattest Services
1.297 Independence Standards for
Engagements Performed in
Accordance with SSAEs

1.240.010 – Overview of Financial Interests
1.240.020 – Unsolicited Financial Interests
1.240.030 – Mutual Funds
1.240.040 – Retirement, Savings, Compensation, or
Similar Plans
1.240.050 – Partnerships
1.240.060 – Limited Liability Companies
1.240.070 - Section 529 Plans

1.260.010- Loans
1.260.020 – Loans and Leases with Lending
Institutions
1.260.030 – Servicing of a Loan
1.260.040 – Leases
1.260.050 – Association With an Entity That Has a Loan to or From an Attest Client

AICPA Ethics Codification

excerpt
Extant Code Citations
New
Introduction
Introduction
New
New
ET section 91
New
New
New
ET section 51
ET section 52
ET section 53
ET section 54
AICPA Ethics Codificaiton Mapping As of December 31, 2013
Title In Code New Citation In Code Title In Codification
0.100
0.100.010
Overview of the Code of Professional Conduct
Principles and Rules of Conduct Composition, Applicability, and
Compliance
Other Guidance
Applicability
Preamble
Article I - Responsibilities
Article II - The Public Interest
Article III - Integrity
0.100.020
0.200.010
0.200.020.01
0.200.020.02-.05
0.200.030
0.200.040
0.200.050
0.300.010
0.300.020
0.300.030
0.300.040
Interpretations and Other Guidance
Structure of the AICPA Code
Application of the AICPA Code
Application of the AICPA Code
Citations
Transition Provisions
Drafting Conventions
Preamble
Responsibilities
The Public Interest
Integrity http://www.aicpa.org/InterestAreas/ProfessionalEthics/Com munity/DownloadableDocuments/Mapping.xlsx

1.400.210Removing Client Files or Proprietary
Information From a Firm
.01 A member whose employment relationship is terminated would be considered in violation of the
Acts Discreditable rule if the member takes or retains
(a) originals or copies (in any format) from the firm ’s client files or (b) proprietary information without the firm ’s permission, unless the member has a contractual arrangement with the firm allowing such action. [Prior reference: paragraphs .381
–.382 of ET section 591]

Part 1: Members in Public Practice
000 INTRODUCTION (New Content)
• 000.010 Conceptual Framework for Members in Public Practice (New
Content)
• 000.020 Ethical Conflicts (New Content)
100 INTEGRITY AND OBJECTIVITY
100.001 “Rule 102” Integrity and Objectivity (ET § 102.01)
• 100.005 Application of the Conceptual Framework for Members in
Public Practice and the Ethical Conflicts Interpretation (New Content)
110 Conflicts of Interest
• 110.010 Conflicts of Interest (ET § 102.03, ER93, ET § 191.186-.187,
ER 99, ET § 191.198-.199, ER110, ET § 191.220-.221)
• 110.020 Director Positions (ER 85, ET § 191.170-.171, Substantive
Change Made) http://www.aicpa.org/InterestAreas/ProfessionalEthics/Community/Dow nloadableDocuments/Preliminary%20Framework%20for%20Codificati on.pdf

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