ch 02 - Chapter 2 Why a Code of Ethics setting a clear tone...

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Chapter 2 Why a Code of Ethics? – setting a clear tone at the top Not all people act ethically under all circumstances. Written guidelines are not a guarantee, but ethical codes help keep honest people honest! F ORMAL CODE OF ETHICAL CONDUCT SENDS A MESSAGE TO ALL AFFECTED PARTIES THAT THE ORGANIZATION WILL NOT TOLERATE UNETHICAL ACTS Six Good Reasons for Organizations to Develop Codes of Ethical conduct: 1. Define acceptable behaviors for relevant parties; 2. Promote high standards of practice throughout the organization; 3. Provide a benchmark for organizational members to use for self evaluation; 4. Establish a framework for professional behavior, obligations and responsibilities; 5. Offer a vehicle for occupational identity; 6. Reflect a mark of occupational maturity. Pg 22-23: ISACA – 10 ethical standards to be followed by certified information system auditors (CISA) IRREGULAR AND ILLEGAL ACTS Ex: fraud, computer crimes, nonconformity with agreements and contracts between organization s and third-party Irregular act reflects an intentional violation of corporate policies, regulatory requirements or an unintentional breach of law Illegal act represents a willful violation of law Management is responsible for the prevention and detection of irregular and illegal acts, not the IT auditor Pg. 22-23 – Overview of IT auditor’s responsibilities with respect to irregular and illegal acts REGULATORY & LEGAL ISSUES Auditors need a working knowledge of regulations and laws so they at least can determine when to refer matters to legal counsel. The following issues will be examined: legal contracts, computer crime, intellectual property rights, and privacy issues LEGAL CONTRACTS A contract is an agreement between or among two or more persons or entities (businesses, organizations or government agencies) to do, or to abstain from doing, something in return for an exchange of consideration promises enforced by laws law provides remedies, including recuperation of losses or specific performance. Legality of contracts fall into two general categories – statutory law and common law IT auditors typically will examine written contracts dealing with purchase and sale of goods (e.g. computer equipment and software applications) Accordingly, at a minimum, auditors should look to ensure that at least 3 elements are contained in the contract Three Elements: (1) Offer Clearly identify subject matter of the agreement Completely describe services including time, place & quality Identify goods including quantity
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(2) Consideration Statement of what the offeror expects in return from the offeree. (3) Acceptance Identify offeree Signed and dated by offeree and offeror Written Contracts that includes the 3 essential elements serve as: Documented evidence that on a certain date the named contractual parties had a ‘Meeting of the Minds’ with respect to a promise and related consideration, as well as
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