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MODULE 21 PROFESSIONAL RESPONSIBILITIES

(2) Also should be independent if, although funds and accounts are separately immaterial, they are material in the aggregate Interpretation 101-11. Modified application of Rule 101 for certain engagements to issue restricted-use reports under the Statements on Standards for Attestation Engagements (1) Rule 101: Independence and its interpretations and rulings apply to all attest engagements. However, for purposes of performing engagements to issue reports under the Statements on Standards for Attestation Engagements (SSAE) that" are restricted to identified parties, only the following covered members, and their immediate families, are required to be independent with respect to the responsible party' in accordance with Rule 10 1: (a) Individuals participating on the attest engagement team; (b) Individuals who directly supervise or manage the attest engagement partner; and (c) Individuals who consult with the attest engagement team regarding technical or industryrelated issues specific to the attest engagement. (2) In addition, independence would be considered to be impaired if the firm had a financial relationship covered by interpretation 10 1-I.A with the responsible party that was material to the firm. (3) In cases where the firm provides nonattest services to the responsible party that are proscribed under interpretation 101-3 and that do not directly relate to the subject matter of the attest engagement, independence would not be considered to be impaired. (4) In circumstances where the individual or entity that engages the firm is not the responsible party or associated with the responsible party, individuals on the attest engagement team need not be independent of the individual or entity, but should consider their responsibilities under interpretation 102-2 with regard to any relationships that may exist with the individual or entity that engages them to perform these services. (5) This interpretation does not apply to an engagement performed under the Statement on Auditing Standards or Statement on Standards for Accounting and Review Services, or to an examination or review engagement performed under the Statements on Standards for Attestation Engagements. ' Interpretation 101-12. Independence is impaired if during professional engagement or while expressing an opinion, member's firm had any material cooperative arrangement with client. (1) Cooperative arrangement exists when member's firm and client participate jointly in business activity such as (a) Joint ventures to develop or market a product or service (b) Arrangements to provide services or products to a third party (c) Arrangements to combine services or products of the member's firm with those of client to market them with references to both parties (d) Arrangements under which member firm or client act as distributor of other's products or services (2) Joint participation with client is not a cooperative arrangement and is thus allowed if all of the . following three conditions are present. (a) Participation of the firm and client are governed by separate agreements (b) Neither firm nor client assumes any responsibility for the other (c) Neither party is an agent of the other Interpretation 101-13. (Deleted) Interpretation 101-14. If a firm is organized in an alternative practice structure, in which the attest function is part of a larger organization that leases the staff to the attest function, the independence provisions of the AICPA Code of Professional Conduct must be adhered to by all staff and management on attest engagement and every individual that is a direct superior of attest partners or managers. Indirect superiors of attest partners and managers cannot have any relationships prohibited by Interpretation 10 I-lA. As defined in the SSAE.