BUAW 7 + 8 - Ethical Conflict and Reporting Unethical Behaviour Flashcards
What principle does conflict of interest impact
objectivity & confidentiality
and can impact when having clients that could be a conflict of interest
What is meant by loyalty?
not changing support or your beliefs and principles for an organisation
this can be conflicted when your employer is acting unethically
What should accountant do, if they are under pressure of employer being unethical-
-persuade them not to continue with unlawful activity
-speak to senior, or go through with the formal dispute resolution process
-resign but maintain the duty of confidentiality to the employer
when resolving conflict what should the accountant consider..
-relevant facts
-access all ethical issues involved
-principles involved
-seek advice
-is there established procedures
- alternate actions to take
examples of organisational and professional values
-honesty and transparency with colleagues, customers and supplier
-open and honest of hospitality
- providing fair treatment
- reporting financial and regulatory information clearly and on time
- suppliers paid on time and fairly
Whistleblowing is defined as..
telling someone in authority about misconduct, alleged dishonesty or illegal activity that has occurred in an organisation
to whistle blow internally make sure that..
have all the evidence, follow internal procedures, and fully explained to management
What council do externally whistleblow too?
FRC= Financial reporting council
What disclosure act protects an employee from whistleblowing?
PIDA- Public Interest Disclosure Act 1998
Define Liability
legal responsibility for something with risk of paying damages
Is negligence a breach of duty of care
yes
how to minimise the risk of professional negligence
professional negligence is
Money Laundering is
illegally acquired cash through financial systems so that it appears legally acquired
3 stages of money laundering
1) Placement
2) Layering
3) Integration
Placement is
Placement is money is moved into system
Layering is
Layering is creating a complex web of transactions to move money around.
Integration is
integrate illegal funds back into system
Money Laundering Penalties
unlimited fines or/and prison 14 years
what are the 3 money laundering offences
1)concealing = disguise
2) arrangement = guilty of offences, from being involved
3) Acquisition = guilty of possession of criminal property
What is failure to disclose?
do not report suspicion= 5 years imprisonment and/or a fine
disciplinary action from the professional accounting body
prejudicing an investigation?
can be anyone who know a ML investigation is going on and makes either a disclosure or falsifies, conceals or destroys documents.
=5 years imprisonment and/or a fine
What is tipping off?
accountant know of a ML report and worns or tells those suspected of this investigation.
=5 years imprisonment and/or a fine
if an accountants not registered with an accounting body- who should they register with ?
HMRC
Before taking on clients and providing services, what must the accountants do?
Customer Due Diligence
“evaluating a prospective business decision by investigating relevant financial, legal and other important info about the other party”
What should CDD Documents include
1) verify the identity
2) verification on the owner too, not necessarily who runs it
3)purpose and nature of transaction
What does SAR stand for?
Suspicious Activity Report
what is the difference between protected and required and authorised disclosure?
Protected= breach of confidentiality
Required= when accountants suspect ML on client
authorised= realise engaged in ML.=/ about to be
