PRPG Fundamental Principles

Question 1

What are the 5 fundamental principles of the PRPG?

Answer 1

Integrity
Objectivity
Professional competence and due care
Confidentiality
Professional behaviour

Question 2

What does integrity refer to?

Answer 2

To be straightforward and honest in all professional and business relationships

Question 3

What does objectivity refer to?

Answer 3

To not allow bias, conflict of interest or undue influence of others to override professional or business judgements

Question 4

What does professional competence and due care refer to?

Answer 4

To maintain professional knowledge and skill at the level required e.g keep up to date on legislation and techniques, act diligently and in accordance with technical and professional standards

Question 5

What does confidentiality refer to?

Answer 5

To respect the confidentiality of information acquired as a result of professional and business relationships, not to disclose info without proper authority unless there is a legal or professional right/duty to disclose.

Nor to use the info for personal advantage

Question 6

What does professional behaviour refer to?

Answer 6

To comply with relevant laws and regulations and avoid any action that discredits the profession

Question 7

What is a member?

Answer 7

A member of the CIOT or ATT including students and ADIT affiliates

Question 8

What is a member in practice?

Answer 8

A member (including students) who provides taxation services on a full-time or part-time basis as a sole practitioner, a partner in a partnership, a member of an LLP or proprietor of an unincorporated body, or a director of or an employee of a company providing taxation services in which they have a financial interest which represents 5% or more the equity capital

Question 9

What does PRPG stand for?

Answer 9

Professional rules and practice guidelines

Question 10

Who is not bound by the Professional Rules and Practice Guidelines?

Answer 10

Fellows of ACA, members of HMRC

Question 11

What duty does a member have to their clients?

Answer 11

A duty to act with reasonable care and skill, honesty, impartiality, integrity and professionalism

Question 12

In the event that a member in practice outside the UK encounters a conflict between the PRPG and the law of the country where they are practising, that member should…

Answer 12

Comply with local laws first

Question 13

Who does the tax disciplinary board operate independently of?

Answer 13

The CIOT and ATT

Question 14

What is the relationship between the tax disciplinary board and the tax disciplinary scheme?

Answer 14

The TDB manages the tax disciplinary scheme

Question 15

What is a member’s duty to the CIOT/ATT?

Answer 15

To not act in such a way to bring the CIOT/ATT into disrepute, or in any way which would harm the reputation or standing of the CIOT/ATT

Question 16

Besides the CIOT/ATT, who else does a member have duties and obligations to?

Answer 16

Other regulators and professional bodies e.g HMRC or the Financial Reporting Council

Question 17

Which principle does the following statement relate to? “A member must not engage in or be party (directly or indirectly) to any illegal activity?

Answer 17

Integrity

Question 18

Which principle does the following statement relate to? “A member should be courteous and considerate towards all with whom they come into contact in the course of their professional work?”

Answer 18

Professional behaviour

Question 19

True or false, you do not owe a duty of confidentiality until a letter of engagement is in place?

Answer 19

False

Question 20

What are two examples of situations that could potentially threaten client confidentiality?

Answer 20

A tax advisor in sole practice needing a second opinion from another member
A tax adviser disclosing an error to HRMC (that was made by HMRC) which generated a large tax repayment to a client

Question 21

A member must provide such information as is reasonably requested by the CIOT and ATT within what timeframe?

Answer 21

Without unreasonable delay

Question 22

What are three examples where a member but notify the CIOT?

Answer 22

• Being charged with assault
• If disciplinary action is upheld against him
• If a bankrupcy order has been made against him

Question 23

Which principle does a member’s technical knowledge refer to?

Answer 23

Professional competence and due care

Question 24

What happens if a member notifies the ATT or CIOT of bankruptcy?

Answer 24

Their professional body will consider whether their membership should continue

Question 25

What does a member’s duty of care cover?

Answer 25

Honorary work, pro bono work, work for family, friends and charity organisations

Question 26

What is honorary work?

Answer 26

A formal honorary post for charities, amateur organisations and other ‘not for profit’ organisations