A tax client asks Lara to perform tax compliance services. Which statement best describes an activity that would illustrate the application of due professional care under the AICPA Code of Professional Conduct?
A. Lara will have a written agreement for this engagement.
B. Lara will charge the client on a contingent fee basis.
C. Lara will apply to be an IRS enrolled agent.
D. Lara will review any prior year tax returns.
Answer (2)
The best illustration of due professional care in tax compliance services is when Lara reviews prior year tax returns. This action ensures a thorough understanding of the client's financial history, which is essential for accurate tax preparation. Other options, while relevant to professional conduct, do not exemplify due professional care as effectively as reviewing past returns. ;
The best option illustrating due professional care is for Lara to review any prior year tax returns, as it ensures accuracy and thorough understanding of the client's financial history. This practice is essential for effective tax preparation and compliance. The other options, while valid actions, do not embody due professional care as directly as reviewing past returns does.
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