New Ethics Interpretation adopted; two exposure drafts released.

The Professional Ethics Executive Committee recently adopted a new Ethics Interpretation [101-15--Financial Relationships], under Rule 101, Independence (AICPA, Professional Standards, vol. 2, ET sec. 101-01) which defines financial interest, direct financial interest and indirect financial interest as used in Ethics Interpretation 101-1 and provides guidance to members on determining whether financial interests should be considered direct or indirect financial interests. The PEEC did not adopt the Insurance Products example included in the exposure draft, as it decided the issue of mutual insurance companies required further study. The PEEC also plans to study loans, and as such, the new interpretation does not change the existing guidance dealing with loans. To view the interpretation, go to www.aicpa.org/download/ethics/interp101_1.pdf.

In additional actions, the PEEC issued an exposure draft that proposes a revision to Interpretation 101-1 under Rule 101, Independence, and also exposed for comment the "Conceptual Framework for AICPA...