The American Institute of CPAs’ Professional Ethics Executive Committee has issued an exposure draft of a proposed new interpretation that warns CPAs they should follow the requirements of governmental bodies, commissions or other regulatory agencies on indemnification and limitation of liability agreements with a client, or run the risk of discrediting the accounting profession.
The guidance reminds members that certain regulators prohibit the use of various indemnification and limitation-of-liability provisions, and that entering into such an agreement with a client who is subject to regulators’ requirements would be considered an act discreditable to the profession.
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