IFAC Professional code of ethics

Purpose of code of ethics:

communicating the organisations values into a brief and sometimes memorable form.
is a means of conveying these values to stakeholders.
identify the key stakeholders and the promotion of stakeholder rights and responsibilities.
influence and control individuals behaviour, especially internal stakeholders such as
management and employees.
part of an organisations strategic positioning.
Contents of code of ethics:
Values of the company.
Shareholders and suppliers of finance.
Policies towards employees.
How the company intends to treat its customers.
How companies source their products.
The manner in which the company aims to relate to community and wider society.
Advantages of principles-based framework
The onus on the professional accountant to think about relevant issues in a
given situation, rather than simply avoiding a checklist of unacceptable actions.
A framework prevents professionals interpreting legalistic requirements
narrowly to get around the ethical requirements.
It allows for variations, which is important as situations differ.
It can accommodate a rapidly changing environment, such at the one in which
accountants operate.
Disadvantages of principles-based framework
Ethical codes cannot include all circumstances and dilemmas, so accountants
need a very good understanding of the underlying principles.
International codes cannot fully capture regional cultural variations in beliefs
and practice.
Principles-based codes can be difficult to enforce legally, unless the breach of
the code is blatant. Most are therefore voluntary and perhaps therefore, less
effective.
Professions and the public interest
IFAC's code of ethics defines professionalism in terms of
professional behaviour.
Professional behaviour imposes an obligation on professional
accountants to comply with relevant laws and
regulations and avoid any action that may bring discredit
to the profession.
To serve the public interest is one of the most
important expectations of accountants.
Slide 6 ACCA 400-0988-775 ACCA acca.finance365.com
Professions and the public interest
The public interest is considered to be the collective wellbeing
of the community of people and institutions the
professional accountant serves, including clients, lenders,
governments, employers, employees, investors, the business
and financial community and others who rely on the work of
professional accountants (IFAC).
Slide 7 ACCA 400-0988-775 ACCA acca.finance365.com

Professions and the public interest

Professionalism means avoiding actions that bring discredit
on the accountancy profession.