Going from cpa firm to client impairs independence or vice versa?

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  • February 4, 2014 at 12:12 pm #183384
    Anonymous
    Inactive

    Hey guys I have my audit retake in a few hours but a quick question. Does going from the client to the cpa firm impair independence/going from the cpa firm to the client require a one year cool off, or do I have this backwards?

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  • February 4, 2014 at 1:47 pm #508307
    Not a Quitter
    Participant

    I'm pretty sure the cool off if for leaving a firm to go work for a client.

    FAR- 85 I'm DONE!
    BEC- 75
    REG- 60,60,75
    AUD- 74,74,83

    CPAExcel used for BEC, AUD, REG
    Exam Matrix used for FAR plus NINJA Blitz, cpareviewforfree and a little CPAExcel

    February 4, 2014 at 1:47 pm #508365
    Not a Quitter
    Participant

    I'm pretty sure the cool off if for leaving a firm to go work for a client.

    FAR- 85 I'm DONE!
    BEC- 75
    REG- 60,60,75
    AUD- 74,74,83

    CPAExcel used for BEC, AUD, REG
    Exam Matrix used for FAR plus NINJA Blitz, cpareviewforfree and a little CPAExcel

    February 4, 2014 at 3:29 pm #508309
    Anonymous
    Inactive

    That's how it reads to me too.

    But the flip side, going from a client to a cpa firm impairs independence?

    February 4, 2014 at 3:29 pm #508367
    Anonymous
    Inactive

    That's how it reads to me too.

    But the flip side, going from a client to a cpa firm impairs independence?

    February 4, 2014 at 5:03 pm #508311
    mystical guy
    Member

    If either way, if it's a key financial position, the 1 year cool is needed and the threat to independence need to be removed (e.g. participating in some pension plans can impair independence so the person would need to stop participating).

    However, going to a lower position, e.g. Staff Accountant, where there is no influence on the audit engagement, and there are specific rules for ensuring that independence is maintained (in either client or the audit firm), will not impair independence.

    Don't worry, they won't confuse you. Look for the key words ..”key financial position” for instance…and the 1 year cool off period

    CPA - Since 2015
    CISA - Smashed 2012
    CIA - Passed 2015

    February 4, 2014 at 5:03 pm #508369
    mystical guy
    Member

    If either way, if it's a key financial position, the 1 year cool is needed and the threat to independence need to be removed (e.g. participating in some pension plans can impair independence so the person would need to stop participating).

    However, going to a lower position, e.g. Staff Accountant, where there is no influence on the audit engagement, and there are specific rules for ensuring that independence is maintained (in either client or the audit firm), will not impair independence.

    Don't worry, they won't confuse you. Look for the key words ..”key financial position” for instance…and the 1 year cool off period

    CPA - Since 2015
    CISA - Smashed 2012
    CIA - Passed 2015

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