If a retired partner works for one month reviewing tax returns, how does this affect her independence?

The independence of a CPA, particularly in a public accounting context, is crucial for maintaining the integrity and objectivity of the profession. A retired partner who engages in reviewing tax returns, even for a short duration like one month, can raise significant concerns over independence.

When a former partner becomes involved in any capacity that may influence or appear to influence objectivity, it can lead to a perceived conflict of interest. Independence is not merely about the actuality of biased actions; it also encompasses the perception of impartiality in the eyes of the public and clients.

Even if the retired partner is not compensated for the work, their prior connection to the firm can create a familiarity threat, which may compromise objectivity. Clients and stakeholders expect that accountants provide unbiased opinion and advice that is free from conflicts that might arise from past relationships with the firm.

Thus, the retired partner's involvement in this capacity could serve to impair independence because of the potential for both actual and perceived conflicts. Therefore, independence is considered impaired due to the connection and influence of the retired partner’s former role within the firm.