2 - CIMA's Code of Ethics Flashcards
what are the responsibilities of CIMA and its members when it comes to ethics
- duty to protect public interest
- IFAC requires CIMA to apply standards no less stringent than IFACs, it is constantly revised
- CIMA Code of Ethics For Professional Accountants = standards expected of members
- members expected to use them in everyday reasoning
CIMAs code of ethics AIMS
- identify nature of personal responsibility accountants have
- provide guidance on identifying situation s where there may be ethical pitfalls
- provide guidance on how to address pitfalls and difficult qs
CIMAs code of ethics FUNDAMENTAL PRINCIPLES
- objectivity = free from bias
- professional competence and due care = technically competent
- professional behaviour = not doing anything to negatively impact reputation
- integrity = honest and straightforward
- confidentiality
what are the instances whereby confidential information can be disclosed
- permitted by law
- permitted by client or employer
- required by law
- permitted by professional duty or right
what are the 5 groups of threats to fundamental principles
- self interest = conflict of interest
- self review = they wont appropriately evaluate results of previous judgement
- advocacy = promote clients position to point where objectivity is compromised
- familiarity = too sympathetic to interests
- intimidation = perceived pressures
actions to overcome threats
- eliminate circumstances causing threat
- apply safeguards to reduce level of threat
- decline/end professional activity
what are cima’s safeguards
- education/training
- corporate governance requirements
- duty to report ethical breaches
- professional/regulatory monitoring
- complaints systems
other non cima, workplace friendly safeguards
- internal controls and oversight
- ethics/codes of conduct
- stricter recruitment procedures
- disciplinary processes
- ethical leadership
- awareness of communication channels
personal qualities that CIMA expect of their members
- reliability
- responsibility
- respect
- timeliness
- courtesy
professional qualities that CIMA expect of their members
- independence of mind (iom)
- independence of appearance (how others perceive your iom)
- professional scepticism = applying right level of scepticism
- accountability
- social responsibility
which terms are identified in the CGMA responsible business report
- responsible business = ESG and economic way of operating
- business ethics = business principles and application of values
- ethical performance = actual behaviour corresponding to values
- ethical management information = quant/qualitative to allow performance evaluation
- integrated reporting = non financial info included
examples of ethical issues for organisations
- data/info security
- discrimination
- human rights
- conflict of interest
- bribery
- supply chain management
- responsible marketing
- remuneration policies
- whistleblowing
- employee safety
why produce a code of ethics
help prevent misconduct
how do businesses ensure behaviour reflects values
commit to identified core values eg integrity, honesty, respect etc
how to emphasise code
embedded into communications and training to integrate into culture
bad practices when it comes to ethical codes
- allowing exceptions
- only putting copy on noticeboard
- failing to investigate breaches
- failure to feature code in training
- senior management not following code
- treating code as internal document
- not allowing staff easy access
- not reviewing code regularly
- failing to get board commitment to code
benefits of making ethical values explicit
- increased employee loyalty/morale
- improved reputation
- attracts high calibre staff
- open and innovative culture
- reduced borrowing/insurance costs
- reduces integrity risk
what is cimas definition of professional development
development of personal qualities eg communication, assertiveness, time management etc
have to be developed
what is cimas definition of lifelong learning
individual never stops learning and open to new skills, behaviours etc
stages in CIMA development cycle are
- define = define roles
- assess = identify knowledge gaps
- design = construct activity programme
- act = undertake learning activities
- reflect = assess if further training needed
- evaluate = any gaps rolled into next cycle
examples of development activities
- reading professional publications
- computer based training
- research and project work
- attending cima events
how does the work accountants produce impact the public and shareholders
AUDIT WORK = public relying on audited accounts
ACCOUNTANCY WORK = accurate prep of accounts essential for evaluating profitability and taxation
INVESTMENT DECISIONS = accurate investment analysis to determine where money best placed
what are the three aspects of the guidance entitled ‘embedding ethical values’ from CIMA joint with Institute of Business Ethics
- ensuring business behaviour reflects ethical values: identify core values
- why produce a code of ethics? help prevent misconduct
- is a code enough? codes to be embedded
