Question

With respect to the acceptance of contingent fees for professional services, the IFAC Code of Ethics for Professional Accountants indicates that the accounting firm a. Should not accept contingent fees. b. Should establish appropriate safeguards around acceptance of a contingent fee. c. Should accept contingent fees only for assurance services other than audits of financial statements. d. Should accept contingent fees if it is customary in the country.

Answer 1

The IFAC Code of Ethics for Professional Accountants states that appropriate safeguards should be established for the acceptance of contingent fees.

Step-by-step explanation:

The subject of this question is Business, specifically related to the acceptance of contingent fees for professional services, as stated in the IFAC Code of Ethics for Professional Accountants.The answer to the question is option b. The IFAC Code of Ethics for Professional Accountants indicates that an accounting firm should establish appropriate safeguards around acceptance of a contingent fee.This is important because contingent fees can create a conflict of interest and compromise the independence of the accountant. By establishing safeguards, the accounting firm can ensure that ethical standards are maintained.