For the following situation, state whether the CPA has violated the CHARTERED PR

Question

For the following situation, state whether the CPA has violated the CHARTERED PROFESSIONAL ACCOUNTANTS OF ONTARIO Professional Rules of Conduct and/or Independence Standard, and explain your reasoning.

1. Harry, a CPA student, is currently employed by a CPA firm in public practice. He accepts a 15% discount on purchases from an audit client. Harry believes that he has not violated the Rules of Conduct because he is not yet a CPA member and the discount is at the same percentage that is available to the client’s own staff members.

Explanation / Answer

Yes, the CPA Student has violated the Independence Standard No,204.6, 204.9 & 207 of CHARTERED PROFESSIONAL ACCOUNTANTS OF ONTARIO Professional Rules of Conduct. Since, the discount available on purchases is exclusively available for only client's own staff members and not to general public, therefore it is a benefit given to the CPA student.

The CPA student should disclose this interest to his employer and also disclosure shall be made in the firm's report about nature and extent of such interest.

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