Acca aaa s21 Notes

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Chapter 4
PROFESSIONAL ETHICS
1. Introduction
It was mentioned in the previous chapter that before accepting an appointment, the auditor must 
ensure that the appointment will be ethical.
Ethics is seen as the unique selling proposition of professional accountants. If they do not adhere 
strictly to ethical principles, how could they continue to earn good fees? What is the point in paying 
someone for advice or assurance if they cannot be trusted or believed?
The ACCA Code of Ethics and Conduct ('the Code') is based on the IESBA’s Code of Ethics. It sets out 
certain fundamental principles about how its members should behave. It also recognises how its 
members could be subject to certain threats which would compromise their behaviour, and suggests 
ways in which members can safeguard themselves against the operation of those threats. 
The conceptual framework approach to professional ethics recognises that there are:
๏
Fundamental 
principles
to be followed
๏
These are subject to 
threats
๏
Threats must be 
addressed
The Code applies to all members of ACCA and also to all ACCA students. Note that applies not only to 
those in public practice ('auditors') but also those in industry and commerce ('in business').
2. Fundamental principles
The ACCA’s fundamental principles are as follows:
๏
Integrity
๏
Objectivity
๏
Professional competence and due care
๏
Confidentiality
๏
Professional behaviour
See 
Chapter 4 of our AA notes
 if you need to revise the fundamental principles.
Note that in AAA you need to be able to explain when the duty of confidentiality must be set aside in 
order to disclose non-compliance with laws and regulations (see Chapter 6).