Question

Some have suggested eliminating the provision of Rule 203 of the AICPA’s professional ethics that permits non-conformance with GAAP if, in the opinion of the CPA, following GAAP would result in misleading financial statements. Thoroughly discuss the pros and cons of eliminating this provision of Rule 203 and present a convincing argument as to whether it should or should not be eliminated.

Please be sure to include scholarly research and support for your findings as you address the questions outlined above in your paper.

Answer 1

Limited flexibility: Companies may have unique circumstances that make it difficult to conform to GAAP guidelines. Eliminating Rule 203 would limit their ability to present financial statements that accurately reflect their situation.

Step-by-step explanation: