It is not sufficient for a professional accountant

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Unformatted text preview: ts, which may occur when a previous judgment needs to be reevaluated by the professional accountant responsible for that judgment; (c) Advocacy threats, which may occur when a professional accountant promotes a position or opinion to the point that subsequent objectivity may be compromised; (d) Familiarity threats, which may occur when, because of a close relationship, a professional accountant becomes too sympathetic to the interests of others; and (e) Intimidation threats, which may occur when a professional accountant may be deterred from acting objectively by threats, actual or perceived. 100.10 Parts B and C respectively, provide examples of circumstances that may create these categories of threats for professional accountants in public practice and professional accountants in business. Professional accountants in public practice may also find the guidance in Part C relevant to their particular circumstances. 100.11 Safeguards that may eliminate or reduce such 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. 100.12 Safeguards created by the profession, legislation or regulation include, but are not restricted to: (a) Educational, training and experience requirements for entry into the profession. (b) Continuing professional education requirements. (c) Corporate governance regulations. 16 By-Laws (On Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants [Issued January 2007] PART I: BY-LAWS ON PROFESSIONAL ETHICS (d) Professional standards. (e) Professional or regulatory monitoring and disciplinary procedures. (f) External review by a legally empowered third party of the reports, returns, communications or information produced by a professional accountant. 100.13 Parts B and C respectively, discuss safeguards in the work environment for professional accountants in public practice and those in business. 100.14 Certain safeguards may increase the likelihood of identifying or deterring unethical behaviour. Such safeguards, which may be created by the accounting profession, legislation, regulation or an employing organization, include, but are not restricted to: (a) Effective, well publicized complaints systems operated by the employing organization, the profession or a regulator, which enable colleagues, employers and members of the public to draw attention to unprofessional conduct or unethical behaviour. (b) An explicitly stated duty to report breaches of ethical requirements. 100.15 The nature of the safeguards to be applied will vary depending on the circumstances. In exercising professional judgment, a professional accountant 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 conclude to be unacceptable. Ethical Conflict Resolution 100.16 In evaluating compliance...
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