Gloria and Deloria, CPAs, have recently started their public accounting firm and intend to provide attestation and a variety of consulting services for their clients, which are all nonpublic. Both Ms. Gloria and Mr. Deloria have particular expertise in designing payroll and other disbursement systems. Ms. Gloria is concerned about whether any of the following services would impair their audit independence.

a.For each of the services in the accompanying table, provide a judgment as to whether providing the service would impair attest independence. Assume that management has designated a management-level individual to be responsible for overseeing the CPAs services and has established appropriate internal control. Also assume that the client is privately held and does not report to the SEC.

b.Now assume that the services are being contemplated for non-attest clients. Which of the services does the AICPA Code of Professional Conduct prohibit under this assumption?

1. Provide all of the initial training and instruction to client employees on a newly implemented payroll information and control system. Independence Impaired (Yes, No, Indeterminate) a. attest client b. non-attest client

2. Customize and implement a prepackaged payroll system. (Yes, No, Indeterminate) a. attest client b. non-attest client

3. Manage a client's local area network system related to payroll. (Yes, No, Indeterminate) a. attest client b. non-attest client

4. Screen candidates and recommend the most highly qualified candidate to serve as treasurer for the client. (Yes, No, Indeterminate) a. attest client b. non-attest client

5. Present payroll business risk considerations to the board of directors on behalf of management. (Yes, No, Indeterminate) a. attest client b. non-attest client

6. Supervise client personnel in the daily operation of the payroll system. (Yes, No, Indeterminate) a. attest client b. non-attest client