Question

An audited entity company has not paid its 2013 audit fees. According to the AICPA Code of Professional Conduct, of the auditor to be considered independent with respect to the 2014 audit, the 2013 audit fees must be paid before the_________

Answer 1

The 2013 audit fees must be paid before the report release date of the 2014 financial statements for the auditor to maintain independence in the 2014 audit, according to the AICPA Code of Professional Conduct.

Step-by-step explanation:

The AICPA Code of Professional Conduct requires that auditors be independent in both fact and appearance when conducting an audit. For an auditor to be considered independent with respect to the 2014 audit, the 2013 audit fees must be paid before the report release date of the 2014 financial statements. This is because unpaid fees can be seen as a financial interest in the company and threaten the auditor's perceived independence. It is crucial that all due fees from prior services be settled to maintain the auditor's professional and ethical standards.