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AICPA Committee Proposes Changes for Members in Business

The American Institute of CPAs’ (“AICPA”) Professional Ethics Executive Committee has proposed amendments to the interpretation of the “Knowing Misrepresentations in the Preparation of Financial Statements or Records” under the Code of Professional Conduct. Outlined in its exposure draft, Omnibus Proposal AICPA Professional Ethics Division: Proposed Revised and New Interpretations Applicable to Members in Business, the PEEC wants to expand the guidance under the “Integrity and Objectivity Rule” to include other responsibilities of a member in business when disclosing financial information or non-financial information and details not bound by reporting requirements.

The PEEC proposes members responsible for financial information to disclose details compliant with an applicable reporting framework when necessary, as well as present information in a way that is neither misleading nor omits details that may portray the information as misleading. Members in business would also have to use professional judgment when identifying the context and purpose in which information is given and anticipated to be used.

In addition, safeguards would be required if a member believes the information is misleading, including sharing the matter with the appropriate point of contact and requesting such person to take the proper actions to resolve the issue.

Comments on the proposed exposure draft are due April 17.

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