2007 part i by laws on professional ethics c d

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Unformatted text preview: orized. In either professional or business relationships, a professional accountant in public practice should always be on the alert for such circumstances and threats. 200.10 Safeguards that may eliminate or reduce threats to an acceptable level fall into two broad categories: (a) Safeguards created by the profession, legislation or regulation; and (b) Safeguards in the work environment. Examples of safeguards created by the profession, legislation or regulation are described in paragraph 100.12 of Part A. 200.11 In the work environment, the relevant safeguards will vary depending on the circumstances. Work environment safeguards comprise firm-wide safeguards and engagement specific safeguards. A professional accountant in public practice should exercise judgment to determine how to best deal with an identified threat. In exercising this judgment a professional accountant in public practice should consider what a reasonable and informed third party, having knowledge of all relevant information, including the significance of the threat and the safeguards applied, would reasonably conclude to be acceptable. This consideration will be affected by matters such as the significance of the threat, the nature of the engagement and the structure of the firm. 28 By-Laws (On Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants [Issued January 2007] PART I: BY-LAWS ON PROFESSIONAL ETHICS 200.12 Firm-wide safeguards in the work environment may include: (a) Leadership of the firm that stresses the importance of compliance with the fundamental principles. (b) Leadership of the firm that establishes the expectation that members of an assurance team will act in the public interest. (c) Policies and procedures to implement and monitor quality control of engagements. (d) Documented policies regarding the identification of threats to compliance with the fundamental principles, the evaluation of the significance of these threats and the identification and the application of safeguards to eliminate or reduce the threats, other than those that are clearly insignificant, to an acceptable level. (e) For firms that perform assurance engagements, documented independence policies regarding the identification of threats to independence, the evaluation of the significance of these threats and the evaluation and application of safeguards to eliminate or reduce the threats, other than those that are clearly insignificant, to an acceptable level. (f) Documented internal policies and procedures requiring compliance with the fundamental principles. (g) Policies and procedures that will enable the identification of interests or relationships between the firm or members of engagement teams and clients. (h) Policies and procedures to monitor and, if necessary, manage the reliance on revenue received from a single client. (i) Policies and procedures to monitor billing and collection of unpaid fees in a timely manner. (j) Using different partners and en...
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