Your firm is proposing on an engagement to help Company X (a tax client) consider whether to acquire Company Y, your former audit client. You have determined that a conflict of interest exists and that safeguards can be applied to reduce threats to an acceptable level. You are planning to discuss the matter with Company Y tomorrow. What action does the AICPA code require in this situation?

You should insist that Company X participate in the discussion with Company Y.You should require that Company Y's entire board of directors be physically present at the meeting.You should threaten to file a lawsuit against Company Y if they do not consent to your providing services to Company X.You should ensure that you do not disclose any confidential client information to Company Y.