Code of Professional Conduct - Principles

Question 1

What are the 6 Articles in Section 1 of the code?

Answer 1

Article I - Responsibility
Article II - The Public Interest
Article III - Integrity
Article IV - Objectivity and Independence
Article V - Due Care
Article VI - Scope and Nature of Services

Question 2

What is Article I - Responsibility?

Answer 2

In carrying out their responsibilities as professionals, members should exercise sensitive professional and moral judgments in all their activities

Question 3

What is Article III - Integrity?

Answer 3

To maintain and broaden public confidence, members should perform all professional responsibilities with the highest sense of integrity. Integrity can accommodate the inadvertent error and honest difference of opinion but it cannot accommodate deceit or subordination of principle. It is measured in terms of what is right and just and requires a member to observe principles of objectivity independence and due care

Question 4

What is Article II - The Public Interest?

Answer 4

Members should accept the obligation to act in a way that will serve the public interest, honor the public trust and demonstrate commitment to the profession.
A distinguishing mark of a professional is acceptance of responsibility to public. The accounting profession’s public consists of clients, credit grantors, governments, employers, investors, business and financial community, and others. In resolving conflicting pressures among groups an accountant should consider the public interest (the collective well-being of the community)

Question 5

What is Article IV - Objectivity and Independence?

Answer 5

A member should maintain objectivity and be free of conflicts of interest in discharging professional responsibilities. A member in public practice should be independent in fact and appearance when providing auditing and other attestation services.

Question 6

What does overall objectivity and independence require?

Answer 6

Objectivity a state of mind:

1. Objectivity imposes obligations to be impartial, intellectually honest, and free of conflicts of interest
2. Independence precludes relationships that may appear to impair objectivity in rendering attestation services.

Regardless of the services performed, members should protect integrity of their work, main objectivity , and avoid any subordination of their judgment.

Question 7

What are the requirements of independence for members in public and nonpublic practice?

Answer 7

Members in public practice require maintenance of objectivity and independence (including avoiding conflict of interest). Attest services - require independence in fact and in appearance.
Members not in public practice are unable to maintain appearance of independence, but should maintain objectivity. When employed by others to prepare FS, or to perform auditing, tax or consulting services, should remain objective and candid in dealings with members in public practice

Question 8

What is Article V - Due Care?

Answer 8

A member should observe the profession’s technical and ethical standards, strive continually to improve competence and the quality of services, and discharge professional responsibility to the best of the member’s ability.

1. competence is derived from both education and experience
2. each member is responsible for assessing his/her own competence and for evaluating whether education, experience and judgment are adequate for the responsibility taken.

Question 9

What is Article VI - Scope and nature of services?

Answer 9

A member in public practice should observe the Principles of the Code of Professional Conduct in determining the scope and nature of services to be provided. Members should:

1. have in place appropriate internal quality control procedures for services rendered
2. determine whether scope and nature of other services provided to an audit client would create a conflict of interest in performance of audit
3. assess whether activities are consistent with role as professionals