Revised Code of Ethics in the Phils - 2010

Revised Code of Ethics in the Phils 2010

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Unformatted text preview: an acceptable level. Accordingly, a firm shall not enter into anysuch fee arrangement. 291.156 A contingent fee charged directly or indirectly, for example through anintermediary, by a firm in respect of a non-assurance service provided to anassurance client may also create a selfinterest threat. If the outcome of thenon-assurance service, and therefore, the amount of the fee, is dependent ona future or contemporary judgment related to a matter that is material to thesubject matter information of the assurance engagement, no safeguardscould reduce the threat to an acceptable level. Accordingly, sucharrangements shall not be accepted. 291.157 For other contingent fee arrangements charged by a firm for a non-assuranceservice to an assurance client, the existence and significance ofany threats will depend on factors such as: • The range of possible fee amounts; • Whether an appropriate authority determines the outcome of the matterupon which the contingent fee will be determined; • The nature of the service; and • The effect of the event or transaction on the subject matter information. The significance of any threats shall be evaluated and safeguards appliedwhen necessary to eliminate the threats or reduce them to an acceptablelevel. Examples of such safeguards include: • Having a professional accountant review the relevant assurance workor otherwise advise as necessary; or • Using professionals who are not members of the assurance team toperform the nonassurance service. Gifts and Hospitality 291.158 Accepting gifts or hospitality from an assurance client may create self-interestand familiarity threats. If a firm or a member of the assurance teamaccepts gifts or hospitality, unless the value is trivial and inconsequential,the threats created would be so significant that no safeguards could reducethe threats to an acceptable level. Consequently, a firm or a member of theassurance team shall not accept such gifts or hospitality. Actual or Threatened Litigation 291.159 When litigation takes place, or appears likely, between the firm or amem...
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This document was uploaded on 04/03/2014.

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