CODE OF ETHICS - Professional Accountants PDF
CODE OF ETHICS - Professional Accountants PDF
ACCOUNTANTS
PRC RESOLUTION NO. 83 series of 2003
• Approved by the Commission on December 2003
• Contains subsequent amendments on the norms
and principles governing the practice of
accountancy profession in the highest standards
of ethical conduct.
GENERAL
APPLICATION
To be straight forward
and honest in all
professional and
business relationships –
fair dealing and
truthfulness.
BACK
To not allow bias,
conflict of interest or
undue influence of
others to override
professional or business
judgments.
BACK
To maintain professional
knowledge and skill at the
level required to ensure that
clients or employers receive
competent professional service.
BACK
PROFESSIONAL
ACCOUNTANTS IN
PUBLIC PRACTICE
(a) Independence of mind - state of mind that permits
the provision of an opinion without being affected by
influences that compromise professional judgment,
allowing an individual to act with integrity, and exercise
objectivity and professional skepticism.
(b) Independence in appearance - the avoidance of facts
and circumstances that are so significant that a
reasonable and informed third party, having knowledge of
all relevant information, including safeguards applied,
would reasonably conclude a firm’s, or a member of the
assurance team’s, integrity, objectivity or professional
skepticism had been compromised.
“Whatever you do, work at it with all your heart, as working
for the Lord, not for human masters”
Colossians 3:23
THREATS TO INDEPENDENCE SAFEGUARDS
• Self-interest Threat – when a • Safeguards that may
firm or a member of the eliminate or reduce such
assurance team could benefit threats to an acceptable
from a financial interest in, or level fall into three broad
other self-interest conflict with, categories:
an assurance client.
• Safeguards created
• Self-Review Threats – (1) when
by the profession,
any product or judgment of a
previous assurance engagement
legislation or
or non-assurance engagement regulation
needs to be re-evaluated in
reaching conclusions on the • Safeguards within
assurance engagement or (2) the client
when a member of the
assurance team was previously
a director or officer of the
• Safeguards within
assurance client, or was an the firm’s own
employee in a position to exert systems and
direct and significant influence procedure
over the subject matter of the
assurance engagement.
THREATS TO INDEPENDENCE SAFEGUARDS
• Advocacy Threat - when a firm, or a • Safeguards that may
member of the assurance team, eliminate or reduce such
promotes, or may be perceived to threats to an acceptable
promote, an assurance client’s
position or opinion to the point
level fall into three broad
that objectivity may, or may be categories:
perceived to be, compromised. • Safeguards created
• Familiarity Threat - when by virtue by the profession,
of a close relationship with an legislation or
assurance client, its directors,
officers or employees, a firm or a
regulation
member of the assurance team
becomes too sympathetic to the • Safeguards within
client’s interests.
the client
• Intimidation Threat - when a
member of the assurance team may
be deterred from acting objectively • Safeguards within
and exercising professional the firm’s own
skepticism by threats, actual or systems and
perceived, from the directors,
officers or employees of an
procedure
assurance client.
Starts when the assurance team begins to
perform assurance services and ends when the
assurance report is issued, except when the
assurance engagement is of recurring in nature.