Rule 301 Confidential Client Information
Rule 301 of the American Institute of Certified Public Accountants’ professional standards states that a member CPA “shall not disclose any confidential client information without the specific consent of the client.” Auditing documentation should not be made available to outside parties without the authorizing of the client. Although the protection of a client’s information is an important principle of being professional, the member need to release the information under certain circumstance.
Here are four exceptions of Rule 301:
1. Compliance with rules 202 (compliance with standards) and 203 (accounting principles) as set forth by the AICPA Code of Professional Conduct. When a member discovers criminal activity or fraud, or an activity the member reasonably expects is criminal or fraudulent based upon his or her good faith belief that there may be a crime or fraud, on the part of his client or employer, the member shall report the illegal activity or fraud to the appropriate supervisor above the person or persons who the member suspects of the illegal activity.
2. Compliance with enforceable subpoena or summons, or must comply with applicable laws ad government regulations. In practice, the member may receive informal request, Civil Subpoenas or Grand Jury Subpoenas. Not all civil subpoenas are valid or enforceable but you may need to comply the grand jury subpoenas because that is a method for a federal grand jury to gather evidence in a criminal matter sufficient to consider indictment. Whenever you are asked to respond to either a formal or informal request for information regarding a client, you should seek the advice of the legal advisor to ensure you are in compliance with such regulations. The member must inform the client about a subpoena.
3. AICPA review of professional practice. If there is a review of a CPA’s practice under AICPA or state society authorization, the member should release the appropriate information.
4. Initiating complaint or
Here are four exceptions of Rule 301:
1. Compliance with rules 202 (compliance with standards) and 203 (accounting principles) as set forth by the AICPA Code of Professional Conduct. When a member discovers criminal activity or fraud, or an activity the member reasonably expects is criminal or fraudulent based upon his or her good faith belief that there may be a crime or fraud, on the part of his client or employer, the member shall report the illegal activity or fraud to the appropriate supervisor above the person or persons who the member suspects of the illegal activity.
2. Compliance with enforceable subpoena or summons, or must comply with applicable laws ad government regulations. In practice, the member may receive informal request, Civil Subpoenas or Grand Jury Subpoenas. Not all civil subpoenas are valid or enforceable but you may need to comply the grand jury subpoenas because that is a method for a federal grand jury to gather evidence in a criminal matter sufficient to consider indictment. Whenever you are asked to respond to either a formal or informal request for information regarding a client, you should seek the advice of the legal advisor to ensure you are in compliance with such regulations. The member must inform the client about a subpoena.
3. AICPA review of professional practice. If there is a review of a CPA’s practice under AICPA or state society authorization, the member should release the appropriate information.
4. Initiating complaint or