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25 November 2014

IFAC: Proposed strengthened guidance for professional accountants in business


The proposals aim to help professional accountants deal with their responsibility to produce financial reports that are faithful representations of the economics of transactions, and also with the pressure to breach fundamental ethical principles.

The IESBA, the Ethics Board, released for public comment the Exposure Draft Proposed Changes to Part C of the Code Addressing Presentation of Information and Pressure to Breach the Fundamental Principles. Comments are requested by April 15, 2015.

“PAIBs play an important role in the financial reporting supply chain, and they may encounter pressure to act unethically. The proposed guidance will help them understand what their options are, and therefore better support them in fulfilling their responsibility to act in the public interest,” said interim IESBA Chair Wui San Kwok. “The proposal also clarifies that when preparing financial information, exercising discretion—for example, when selecting an accounting method—in a manner that is intended to mislead is not acceptable.

Among the proposed changes are:

  • Fuller and more explicit guidance regarding PAIBs’ responsibilities when presenting information
  • Strengthened guidance on how a PAIB can disassociate from misleading information
  • An expanded description of pressure that may lead to a breach of the fundamental principles in the Code of Ethics for Professional Accountants™ (the Code) together with practical examples to illustrate different kinds of situations in which such pressure may arise
  • New guidance to assist PAIBs in identifying and responding to pressure that could result in a breach of the fundamental principles

The Ethics Board is also proposing a number of related changes to other areas within Part C of the Code.

“The development of this enhanced guidance reflects a rebalancing of the board’s focus to be more inclusive of PAIBs, a very large and important part of the accountancy profession,” noted IESBA Technical Director Ken Siong. “It will serve to remind PAIBs of some of the fundamental ethical principles by which they should be guided in their different roles within their organizations, and with which they must comply.”

Press release



© IFAC


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