Professional Ethics (ICAEW Code) Flashcards
6 cards from real ACA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Professional Ethics (ICAEW Code) flashcards as text
Which of the following is an example of an acceptable contingent fee arrangement for an audit client?
Answer: No contingent fees are acceptable for audit engagements
Contingent fees for audit engagements are prohibited under ethical standards as they create an unacceptable self-interest threat to independence; the auditor's remuneration must not depend on the outcome.
Professional accountants must comply with the spirit and letter of ethical requirements. 'Spirit' means:
Answer: Looking beyond the technical wording to the underlying purpose and intent of the requirement
Compliance with the spirit of ethical requirements means understanding and acting in accordance with the underlying purpose of the rules, not merely finding technical compliance while violating their intent.
Under UK anti-bribery legislation (Bribery Act 2010), the corporate offence of failing to prevent bribery:
Answer: Is committed by a commercial organisation that fails to prevent bribery by an associated person
Section 7 of the Bribery Act 2010 creates strict liability for commercial organisations that fail to prevent bribery by associated persons acting on their behalf; the only defence is adequate anti-bribery procedures.
When preparing tax returns, a professional accountant should:
Answer: Present the client's tax affairs honestly, claiming only legitimate reliefs and deductions
Integrity requires honest presentation of tax returns. Accountants should claim legitimate reliefs but must not assist in tax evasion or make false statements; they must also comply with HMRC disclosure obligations.
The ICAEW's disciplinary process can result in which of the following sanctions for a member?
Answer: Reprimand, fines, suspension, or exclusion from membership
ICAEW's disciplinary process can impose a range of sanctions including reprimands, fines, conditions on practice, suspension, or exclusion (striking off) from membership for serious misconduct.
The principle of objectivity requires a professional accountant to:
Answer: Not allow bias, conflicts of interest, or undue influence to compromise professional judgements
Objectivity requires accountants not to allow bias, conflicts of interest, or undue influence — from clients, employers, or others — to override their professional judgements.