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Code of Ethics - Coggle Diagram

- - - - Those who recommend the compensation of, or who provided direct supervisory, management or other oversight of the assurance engagement principle in connection with the performance of the assurance engagement.
      - Those who provide consultation regarding technical or industry specific issues, transactions or events for the assurance engagement, including those who perform the engagement quality control review for the assurance engagement.
- - - - to be straightforward and honest in all professional and business relationships.
    - - to not allow bias, conflict of interest or undue influence of others to override professional or business judgement
    - - to maintain professional knowledge and skill at the level required to ensure that a client or employer receives competent professional services based on current developments in practice, legislation and techniques and act diligently and in accordance with applicable technical and professional standards.
      - Professional Competence - must know your stuff on the service which you are providing.
      - Due Care - need to give enough time an attention to he customers.
    - - Respect the confidentiality of information acquired as a result of professional and business relationships and not disclose any information to third parties without proper and specific authority, unless there is a legal or professional right or duty to disclose, nor use the information for personal advantage
      - Information is given in confidence.
    - - to comply with relevant laws and regulations and avoid any action that discredits the profession.
  - - - Self-Interest
        
        inappropriately influence the warrant holder's judgment or behaviour
      - Self-Review
        
        will not appropriately evaluate the results of a previous judgement made or service performed by the warrant holder, or by another individual within the warrant holder's firm
      - Advocacy
        
        a warrant holder will promote a client/employer's position to the point that the warrant holder's objectivity is compromised.
      - Familiarity
        
        due to a long/close relationship with the client/employer, a warrant holder will be too sympathetic to their interests or too accepting of their work
      - Intimidation
        
        attempts to exercise undue influence over the warrant holder.
    - - Actions or other measures that may eliminate threats or reduce them to an acceptable level.
      - Safeguards created by the profession, legislation or regulation.
        
        Educational, training and experience requirements for entry into the profession.
        
        Continuing professional development requriements.
        
        Corporate governance regulations.
        
        Professional standards
        
        Professional or regulatory monitoring and disciplinary procedures.
      - Safeguards in the work environment.
  - - - Relevant Facts
      - Ethical Issues involved.
      - Fundamental principles related to the matter in question.
      - Established internal procedures.
      - Alternative courses of action.
- - - - Self-interest
        
        • A member of the assurance team having a direct financial interest in the assurance client.
        
        • A firm having undue dependence on total fees from a client.
        
        • A member of the assurance team having a significant close business relationship with an assurance client.
        
        • A firm being concerned about the possibility of losing a significant client.
        
        • A member of the audit team entering into employment negotiations with the audit client.
        
        • A firm entering into a contingent fee arrangement relating to an assurance engagement.
        
        • A warrant holder discovering a significant error when evaluating the results of a previous professional service performed by a member of the warrant holder’s firm.
      - Self-Review
        
        • A firm issuing an assurance report on the effectiveness of the operation of financial systems after designing or implementing the systems.
        
        • A firm having prepared the original data used to generate records that are the subject matter of the assurance engagement.
        
        • A member of the assurance team being, or having recently been, a director or officer of the client.
        
        • A member of the assurance team being, or having recently been, employed by the client in a position to exert significant influence over the subject matter of the engagement.
        
        • The firm performing a service for an assurance client that directly affects the subject matter information of the assurance engagement.
      - Advocacy
        
        • The firm promoting shares in an audit client.
        
        A warrant holder acting as an advocate on behalf of an audit client in litigation or disputes with third parties
      - Familiarity
        
        • A member of the engagement team having a close or immediate family member who is a director or officer of the client.
        
        • A member of the engagement team having a close or immediate family member who is an employee of the client who is in a position to exert significant influence over the subject matter of the engagement.
        
        • A director or officer of the client or an employee in a position to exert significant influence over the subject matter of the engagement having recently served as the engagement principal.
        
        • A warrant holder accepting gifts or preferential treatment from a client, unless the value is trivial or inconsequential.
        
        • Senior personnel having a long association with the assurance client.
      - Intimidation
        
        • A firm being threatened with dismissal from a client engagement.
        
        • An audit client indicating that it will not award a planned non-assurance contract to the firm if the firm continues to disagree with the client’s accounting treatment for a particular transaction.
        
        • A firm being threatened with litigation by the client.
        
        • A firm being pressured to reduce inappropriately the extent of work performed in order to reduce fees.
        
        • A warrant holder feeling pressured to agree with the judgement of a client employee because the employee has more expertise on the matter in question.
        
        • A warrant holder being informed by a principal of the firm that a planned promotion will not occur unless he agrees with an audit client’s inappropriate accounting treatment.
    - - Firm-Wide Safeguards
        
        • Leadership of the firm that stresses the importance of compliance with the fundamental principles.
        
        • Leadership of the firm that establishes the expectation that members of an assurance team will act in the public interest.
        
        • Policies and procedures to implement and monitor quality control of engagements.
        
        • Documented policies regarding the need to identify threats to compliance with the fundamental principles, evaluate the significance of those threats, and apply safeguards to eliminate or reduce the threats to an acceptable level or, when appropriate safeguards are not available or cannot be applied, terminate or decline the relevant engagement.
        
        • Documented internal policies and procedures requiring compliance with the fundamental principles.
        
        • Policies and procedures that will enable the identification of interests or relationships between the firm or members of engagement teams and clients.
        
        • Policies and procedures to monitor and, if necessary, manage the reliance on revenue received from a single client.
        
        • Using different principals and engagement teams with separate reporting lines for the provision of non-assurance services to an assurance client.
        
        • Policies and procedures to prohibit individuals who are not members of an engagement team from inappropriately influencing the outcome of the engagement.
        
        • Timely communication of a firm’s policies and procedures, including any changes to them, to all principals and professional staff, and appropriate training and education on such policies and procedures.
        
        • Designating a member of senior management to be responsible for overseeing the adequate functioning of the firm’s quality control system.
        
        • Advising principals and professional staff of assurance clients and related entities from which independence is required.
        
        • A disciplinary mechanism to promote compliance with policies and procedures.
        
        • Published policies and procedures to encourage and empower staff to communicate to senior levels within the firm any issue relating to compliance with the fundamental principles that concerns them.
      - Engagement-Specific Safeguards
        
        • Having an expert who was not involved with the non-assurance service review the non-assurance work performed or otherwise advise as necessary.
        
        • Having an expert who was not a member of the assurance team review the assurance work performed or otherwise advise as necessary.
        
        • Consulting an independent third party, such as a committee of independent directors, the Accountancy Board, an accountancy body recognised under the Act or an expert.
        
        • Discussing ethical issues with those charged with governance of the client.
        
        • Disclosing to those charged with governance of the client the nature of services provided and extent of fees charged.
        
        • Involving another firm to perform or re-perform part of the engagement.
        
        • Rotating senior assurance team personnel
      - Within the client's systems and procedures
        
        • The client requires persons other than management to ratify or approve the appointment of a firm to perform an engagement.
        
        • The client has competent employees with experience and seniority to make managerial decisions.
        
        • The client has implemented internal procedures that ensure objective choices in commissioning non-assurance engagements.
        
        • The client has a corporate governance structure that provides appropriate oversight and communications regarding the firm’s services.