Professional Ethics Flashcards
According to the Institute of Business Ethics what 3 questions should be asked in order to make an ethical decision?
Transparency - do I mind others knowing
Effect - does it affect or hurt anyone
Fairness - would it be considered fair by those affected
What are the 5 key principles of the Code of Ethics for professional accountants?
Integrity
Objectivity
Professional competence and due care
Confidentiality
Professional behaviour
When should confidential information be disclosed?
When permitted by law or authorised by client/employer
When required by law
When required by professional duty, in the public interest and not prohibited by law
What are the threats to compliance with fundamental principles?
The self interest threat
The self-review threat
The advocacy threat
The familiarity or trust threat
The intimidation threat
How should one approach dealing with ethical conflicts?
Step 1: gather information
Step 2: Analysis
Step 3: Action
What is the CPD cycle?
Assess - what skills do I have
Plan - where am I heading/what skills do I need
Action - carry out actions to gain the skills I need as per above
Evaluate - analyse whether job is done and skills attained yet
What are the differences between structured and unstructured CPD?
Structured are specific to area or needs identified
Unstructured are general information obtaining that is non specific or tailored to an individual’s needs
What are types of business risks?
Political risks
Economic risks
Social risks
Technological risks
Strategic risks
What are the main types of operation risks to a business?
Reputation at risk
Litigation risk
Process risk
People risk
Systems risk
Why are the 3 acknowledged phases to money laundering?
Placement - cash from crime placed in financial system
Layering - obscure transactions using trusts and different entities etc…
Integration - investing funds in legally such as assets and property
Define objectivity?
Means that a member must not allow bias, conflict of interest or undue influence of others to override professional or business judgements
Define professional competence?
Continuing duty of members to:
Maintain professional knowledge and skill at the level required to provide competent professional service based on current developments in practice, legislation and techniques
Define due care?
Means a member must act diligently and in accordance with professional standards when providing professional services
Define integrity?
Being straightforward and fair in all professional and business relationships
Define confidentiality?
In accordance with the law, respect the confidentiality of information and not disclose unless required by law or professional duty
Define professional behaviour?
Complying with relevant laws and regulations and avoid anything that discredits the profession
When dealing with ethical conflicts and and analysing having gathered information should the member consider legal perspective first or ethical principles compromised?
Legal to determine if any laws have been broken then the ethical principles compromised
What does the UK Anti-money laundering legislation (AMLL) consist of?
The Proceeds of Crime Act 2002 (POCA)
The Money Laundering Regulations 2007 (MLR)
The Terrorism Act 2000 (TA)
What are the 3 offences of money laundering under POCA?
S327 - concealing, disguising, converting, transferring or removing criminal property
S328 - taking part in an arrangement to facilitate the acquisition, use or control of criminal property
S329 - acquiring, using or possessing criminal property
What is the procedure required to report money laundering?
If an MLRO exists submit an internal report to him if it does not submit a report to NCA (National Crime Agency)
What are the four offences under the Bribery Act 2010?
- Bribing a person to induce or reward them (active bribery)
- Requesting, accepting or receiving a bribe (passive bribery)
- Using a bribe to influence a foreign official to gain business advantage
- Failing to prevent bribery on behalf of a commercial organisation
What is the penalty under the Bribery Act 2010?
Imprisonment for upto 10 years and an unlimited fine
What are the 3 distinct offences of fraud in the Fraud Act 2006
Fraud by false representation (Section 2)
Fraud by failing to disclose information (Section 3)
Fraud by abuse of position
(Section 4)
What are the three reserved areas of accountancy and finance?
Insolvency
Investment business
External audit
Which professional body sets global ethical standards for accountants?
IASB - International Accounting Standards Board
Which body is responsible for developing quality standards for all accountancy bodies?
IFAC - International Federation of Accountants
Which Accountancy Bodies are members of the CCAB (Consultative Committee of Accountancy Bodies)?
CIPFA ICAEW ICAS CAI ACCA
Which accountancy bodies are sponsors of the AAT?
CIPFA
ICAEW
ICAS
CIMA
What are the main grounds for civil law cases?
Breach of contract
Breach of trust
Negligence
What are the legal requirements and actions to be taken if a client refuses to disclose an error or emission from a tax return?
Advise the client/employer of the implications and to disclose
Allow reasonable time to correct the issue
Advise client or employer that you will be reporting To the MLRO or NCA
