In deciding whether a conflict of interest exists,the relevant standard to be applied is whether:
A) The CPA subjectively believes that a conflict of interest exists
B) A reasonable observer, with reasonable knowledge of the relevant circumstances, would conclude that a conflict of interest exists
C) In an accountant-client conflict of interest situation, at least one of the clients believes, reasonably or unreasonably, that a conflict of interest exists
D) In a dual-client conflict of interest situation, both of the clients themselves believe, reasonably or unreasonably, that a conflict of interest exists

Question

Quizplus · Accepted Answer

The relevant standard to be applied in deciding whether a conflict of interest exists is whether a reasonable observer, with reasonable knowledge of the relevant circumstances, would conclude that a conflict of interest exists. This objective standard helps ensure that conflicts of interest are identified and addressed consistently and impartially, regardless of the subjective beliefs or opinions of the CPA or the clients involved.

In Deciding Whether a Conflict of Interest Exists,the Relevant Standard