AI for CPA Firms Quiz

Answers and explanations appear as you take the quiz.

1. Which US tax provision does the guide say firms must consider before sending tax return information to third-party AI tools?
   • Section 179
   • Internal Revenue Code Section 7216
   • Section 401(k)
   • Section 1031
2. What advantage do AI audit analytics tools offer over traditional testing, according to the guide?
   • They eliminate the need for audit opinions
   • They remove PCAOB oversight
   • They only test the largest transactions
   • They can test the entire population of transactions rather than a sample
3. Why does AI put pressure on hourly billing in CPA firms?
   • When tasks take fewer hours, hourly billing reduces revenue for the same work
   • Clients refuse to pay for AI
   • Regulators ban hourly billing for AI work
   • AI tools charge by the hour
4. During onboarding, how does the guide's example system detect a missing 1099-INT?
   • By calling the client's bank
   • By emailing the IRS
   • By comparing this year's uploads with last year's return
   • By estimating interest income from the W-2
5. Which document does the guide name as part of vendor due diligence for AI tools?
   • The vendor's marketing brochure
   • The vendor's SOC 2 report
   • The vendor's tax return
   • A client reference letter
6. What training concern does the guide raise about AI in CPA firms?
   • Juniors will have too much routine work
   • AI requires a separate license
   • Training costs will fall to zero
   • The routine work AI absorbs was how junior staff traditionally learned fundamentals
7. Why must AI audit analytics results be reproducible?
   • They are audit evidence, so a reviewer or inspector must be able to re-perform the test
   • To reduce software licensing fees
   • Because clients own the analytics software
   • To allow the model to retrain nightly
8. What does the guide say should happen to citations in an AI-drafted tax research memo?
   • They can be removed to simplify the memo
   • They are reliable if the tool is expensive
   • A senior should verify each one against the primary source
   • They only need checking for international tax