Regulators have determined that performing certain non-attest services can impair a CPA’s independence. Recently, though, the question has been raised: Do FIN 48 services apply?
FASB Interpretation (or FIN) 48 is titled, “Accounting for Uncertainty in Income Taxes,” and it presents many daunting tasks for tax professionals and their clients alike. According to the AICPA, many CPAs have begun asking whether they can help attest clients in applying FIN 48 without hurting their independence, “given the potential complexity of the judgments that the client must make or approve in connection with such services. “
The short answer is “yes.”
The AICPA’s Professional Ethics Executive Committee has decided that CPAs can assist clients in applying FIN 48 “provided the (CPA) is satisfied that the client understands the reasons why a specific tax position does or does not meet the more-likely-than-not (MLTN) threshold and the basis for the determination of the amount of related unrecognized tax benefits.”
The AICPA’s Professional Ethics Division has released some new guidance related to this decision. CPAs and their clients will be interested in reading it.