Conduct and practice of the malaysian institute of

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Unformatted text preview: cial 90 By-Laws (On Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants [Issued January 2007] PART I: BY-LAWS ON PROFESSIONAL ETHICS dependency exists, in which case, a self-interest threat to independence is created. In such event, the only course of action is to refuse to perform or withdraw from the assurance engagement. (2) The firm is required to submit, together with the annual return of the firm lodged with the Institute, a declaration by the managing partner of the firm that the firm has not breached the threshold set out in subparagraph (1) for that year, and provide documentation in support of this as may be required by any enforcement unit established by the Council for this purpose. 290.207 A self-interest threat may also be created when the fees generated by the assurance client represent a large proportion of the revenue of an individual partner. The significance of the threat should be evaluated and, if the threat is other than clearly insignificant, safeguards should be considered and applied as necessary to reduce the threat to an acceptable level. Such safeguards might include: (a) Policies and procedures to monitor and implement quality control of assurance engagements; and (b) Involving an additional professional accountant who was not a member of the assurance team to review the work done or otherwise advise as necessary. Fees–Overdue 290.208 (1) A self-interest threat may be created if fees due from an assurance client for professional services remain unpaid for a long time, especially if a significant part is not paid before the issue of the assurance report for the following year. Generally the payment of such fees should be required before the report is issued. The following safeguards may be applicable: (a) (b) (2) Discussing the level of outstanding fees with the audit committee, or others charged with governance. Involving an additional professional accountant who did not take part in the assurance engagement to provide advice or review the work performed. The firm should also consider whether it is appropriate for the firm to be re-appointed, taking into account: (a) The overdue fees might be regarded as being equivalent to a loan to the client; and (b) The significance of the overdue fees. 91 By-Laws (On Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants [Issued January 2007] PART I: BY-LAWS ON PROFESSIONAL ETHICS Pricing 290.209 When a firm obtains an assurance engagement at a significantly lower fee level than that charged by the predecessor firm, or quoted by other firms, the selfinterest threat created will not be reduced to an acceptable level unless: (a) The firm is able to demonstrate that appropriate time and qualified staff are assigned to the task; and (b) All applicable assurance standards, procedures are being complied with. guidelines and quality control Contingent Fees 290.210 Contingent fees are fees calculated on a predetermined basis...
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This document was uploaded on 09/23/2013.

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