Professional Ethics Flashcards
What are the 5 principles of ethical code
Integrity: straightforward and honest in their work
Objectivity: dont allow biaas or conflict of interest to override professional judgement
Professional Competence and Due Care: only take on work you are capable of doing.
Confidentiality: shouldnt disclose confidential info to third parties without permission or for personal gain
Professional Behaviour: accountants should comply with relevant laws and not do anything to discredit the profession
When can accountants disclose confidential information
When authorised by the client to do so
When there is a professional duty to do so (requested by tax authorities)
When there is a legal duty to do so (court order against accountant)
What are the threats to integrity (accountant in practice)
Self Interest
* Owning shares in a client.
High proportion of fee income from one client.
* Receiving a loan from a client.
Self Review
* Reporting on the operation of a system that you helped design.
* Preparing accounts and auditing them.
* Doing work for a former employer.
Familiarity
* Having a close personal relationship with senior employees of client.
* A former partner now working for the client.
* Accepting significant goods or hospitality.
Intimidation
* Threat of dismissal or litigation from the engagement.
* Pressure to reduce quality or quantity of work to reduce fee levels
What are the threats to integrity (accountant in business)
Self Interest
* Owning shares in an employer.
* Bonuses based on profit.
* Threat to job security or promotion if results not achieved.
Self Review
* Being asked to review data or evaluate decisions that you were
involved in
Familiarity
* Having a close personal relationship with other members of staff.
* Long association with a business contact influencing your decisions.
* Accepting goods or hospitality that influences your decisions.
Intimidation
* Threat of dismissal or being passed over for promotion.
* A dominant individual attempting to influence your decisions.
