Kế toán, kiểm toán - Chapter 3: Professional ethics

Professional EthicsChapter 3Steps in Resolving an Ethical DilemmaIdentify the problemIdentify possible courses of actionIdentify any constraints relating to the decisionAnalyze the likely effects of the possible courses of actionSelect the best course of action2AICPA Professional Ethics3 The Rules of the AICPA Code of Professional ConductRule Title101 Independence102 Integrity and Objectivity201 General Standards202 Compliance with Standards203 Accounting Standards301 Confidential Client Information302 Contingent Fees501 Acts Discreditable502 Advertising and Other Forms of Solicitation503 Commissions and Referral Fees504 (Deleted)505 Form of Organization and Name4Independence AppearanceFactRules have to be based on appearance because fact or objectivity is difficult to enforce.5Covered MembersStaff working on the attest engagementAn individual who may influence the attest engagementA partner in the office in which the partner in charge of the attest engagement primarily practicesPartners or managers that provide a specified amount of nonattest services to clientThe public accounting firm and its employee benefit planAny entity controlled by one or more of the above6Independence Rule—Interpretation 101-1A.SectionHas direct or material indirect financial interest, loan, or joint business invest- ment; trustee or administrator of estate or trust that has such interestApplies to:Covered MembersB.Owns 5% or more of client’s outstanding equity or other ownership interestAll Partners andProfessional StaffC.Simultaneously associated with client asdirector, officer, employee, etc.All Partners and Professional Staff7Financial InterestsDirect IndirectExampleInvestment in client, such as owning capital stock or providing a loanInvestment in a mutual fund, which in turns owns capital tock of a clientType allowed for Individual CPA to retain independenceNoneImmaterial8Classes of RelativesImmediate family of covered member—generally rules are same as for member with a couple of exceptionsClose relatives of attest engagement team members, individuals in a position to influence the attest engagement, and partners in the engagement office—no close relatives in key positions or having material financial interestsOther relatives and friends—generally do not present a problem9Consulting Services Prohibited by the Sarbanes-Oxley ActBookkeepingFinancial systems design and ImplementationAppraisal or valuation servicesActuarial servicesInternal audit outsourcingManagement functions or human resource servicesInvestment servicesLegal services and expert servicesCertain tax services10Rule 202 StandardsTechnical BodyAuditing Standards Board (ASB)Management Consulting Services Executive Committee (MCSEC)Accounting and Review Services Committee (ARSC)ASB, MCSEC, and ARSCFASB, GASB and FASACStandardsStatements on Auditing StandardsStatements on Standards for Consulting ServicesStatements on Standards for Accounting and Review ServicesStatements on Standards for Attestation EngagementsFASB, GASB and FASAC Statements and related Interpretations11Allowable Contingent Fees and CommissionsAllowable for clients for which the CPA provides none of the following services:An audit or review of financial statementsA compilation of financial statements expected to be used by a third party and does not disclose a lack of independenceAn examination of prospective financial informationContingent fees are not allowed to prepare an original or amended tax return or claim for tax refund (Note: All tax contingent fees are prohibited under PCAOB Standards)Allowable commissions received must be disclosed to the client12IIA Code of Ethics--PrinciplesInternal auditors are expected to apply & uphold the following principles:  Integrity. The integrity of internal auditors establishes trust and thus provides the basis for reliance on their judgment. Objectivity. Internal auditors exhibit the highest level of professional objectivity in gathering, evaluating, and communi-cating information about the activity or process being examined. Internal auditors make a balanced assessment of all the relevant circumstances and are not unduly influenced by their own interests or by others in forming judgments.  Confidentiality. Internal auditors respect the value and ownership of information they receive and do not disclose information without appropriate authority unless there is a legal or professional obliga-tion to do so.  Competency. Internal auditors apply the knowledge, skills, and experience needed in the performance of internal auditing services. 13IIA Code of Ethics—Rules of Conduct1. Integrity;  Internal auditors:.1 Shall perform their work with honesty, diligence, and responsibility. .2 Shall observe the law and make disclosures expected by the law and the profession. .3 Shall not knowingly be a party to any illegal activity, or engage in acts that are discreditable to the profession of internal auditing or to the organization. .4 Shall respect and contribute to the legitimate and ethical objectives of the organization.  2. Objectivity;  Internal Auditors:.1 Shall not participate in any activity or relationship that may impair or be presumed to impair their unbiased assessment. This participation includes those activities or relationships that may be in conflict with the interests of the organization. .2 Shall not accept anything that may impair or be presumed to impair their professional judgment. .3 Shall disclose all material facts known to them that, if not disclosed, may distort the reporting of activities under review. 14IIA Code of Ethics—Rules of Conduct3. Confidentiality; Internal auditors:.1 Shall be prudent in the use and protection of information acquired in the course of their duties.  .2 Shall not use information for any personal gain or in any manner that would be contrary to the law or detrimental to the legitimate and ethical objectives of the organization.4 Competency; Internal auditors .1 Shall engage only in those services for which they have the necessary knowledge, skills, and experience. .2 Shall perform internal auditing services in accordance with the Standards for the Professional Practice of Internal Auditing. .3 Shall continually improve their proficiency and the effectiveness and quality of their services. 15