THE CODE OF
ETHICS FOR
PROFESSIONAL
ACCOUNTANTS
COMPLYING WITH THE CODE
● A professional accountants responsibility is not
exclusively to satisfy the needs of an
individual client or employing organization.
● Compliance with the Code of Ethics enables
the professional accountants to meet their
responsibility to act in the public interest.
FUNDAMENTAL
PRINCIPLES
• Integrity
• Objectivity
• Professional Competence and Due Care
• Confidentiality
• Professional Behavior
Integrity
● A professional accountants should be straightforward and
honest in all professional and business relationships.
● It implies not merely honesty but it requires being brave
enough to fight for what you believe in.
● A professional accountants should not be associated with
information where he believes that the information contains
incorrect, incomplete or misleading misstatements.
Objectivity
● A professional accountant should not allow bias,
conflicts of interest or undue influence of others to
override objectivity.
Professional Competence and Due
Care
● A professional accountant should continually strive to improve
his knowledge and skills to ensure that a client or employer
receives the advantage of competent professional service
based on up-to-date developments in practice, legislations
and techniques.
Professional competence is divided in two separate phases:
● Attainment of professional competence
● Maintenance of professional competence
This principle imposes the following obligations on professional
accountants to:
● Maintain professional knowledge and skills at the level
required to ensure that clients or employers receive
competent professional service.
● Act diligently in accordance with applicable technical and
professional standards when providing professional services.
Confidentiality
● A professional accountant should respect the confidentiality of
information acquired during the course of performing
professional services and should not use or disclose any such
information without proper and specific authority or unless
there is a legal or professional right or duty to disclose.
● A professional accountant shall continue to comply with the
principle of confidentiality even after the end of the
relationship between the accountant and the client.
Confidential information may be disclosed under the
following circumstances:
● Disclosure is permitted by the client or employer
● Disclosure is required by law
● There is a professional duty or right to disclose
confidential information.
Professional Behavior
● A professional accountant should comply with
relevant laws and regulations and refrain from
any conduct which might bring discredit to the
profession
CONCEPTUAL
FRAMEWORK
THREATS
● Self-Interest Threat - is a threat that a financial or other
interest will inappropriately influence the professional accountants
judgements or behavior.
● Self-Review Threat – is a threat that a professional accountant
will not objectively evaluate the results of the previous judgement
made or service performed in forming a conclusion about the subject
matter of the engagement.
● Advocacy Threat – is a threat that a professional accountant will
promote a client’s or employer’s position to the point that the
professional accountants objectivity is compromised.
● Familiarity Threat - is a threat that a professional
accountant becomes too sympathetic to the interest of others.
● Intimidation Threat – is a threat that the professional
accountant will be deterred from acting objectively by threats,
actual or perceived.
SAFEGUARDS
Are actions or other measures that may eliminate
threats or reduced them to an acceptable level.
Safeguards created by the profession,
legislation or regulation
Safeguards in the work environment
Safeguards created by the profession,
legislation or regulation
• Professional Standards
• Corporate Governance
• Others
Safeguards in the work
environment
• Firm wide safeguards
• Engagement Specific safeguards
CONFLICTS OF INTEREST
May arise in performing professional service and
can be a threat to objectivity.
When a professional accountant provides service
that relates to two or more clients and whose
interest are in conflict
SECOND OPINIONS
When a professional accountant is asked
to provide a second opinion on the
application of accounting, auditing and
reporting of the company.
GIFTS AND HOSPITALITY
When a professional accountants may be offered
gifts and hospitality from a client and such may lead
to threats to compliance.
CUSTODY OF CLIENTS ASSETS
A professional accountant should not assume custody of
client monies or other assets unless permitted to do so by
law.
THANK YOU!
