IESBA ethics code updated to clarify inducement rules

The International Ethics Standards Board for Accountants (IESBA) is consulting on proposals to strengthen the provisions in the code of ethics for professional accountants regarding the accepting and offering of inducements

It proposes to do so by establishing a comprehensive framework that covers all forms of inducements and which applies to both professional accountants in business and professional accountants in public practice.

The revisions, which were informed by input from Transparency International UK based on their experience and insights in the area of bribery and corruption, seek to clarify the appropriate boundaries for giving or receiving inducements and prohibit any inducements made with the intent to improperly influence an accountant’s behaviour.

The proposed framework covers all forms of inducements and applies to both professional accountants in business and professional accountants in public practice. It also provides enhanced guidance on the offering and accepting of inducements by professional accountants’ immediate or close family members.

Stavros Thomadakis, IESBA chairman, said: ‘Inducements with intent to improperly influence behavior are a very major concern for the public interest, and they include the issues of bribery and corruption. Inducements made with improper intent are unacceptable and should be prohibited.’

Among other matters, the proposals also require professional accountants to address any threats to compliance with the fundamental ethical principles in accordance with the code’s conceptual framework where there is no improper intent.

When completed, the provisions will constitute the last piece of the substantively revised and restructured code of ethics for professional accountants.

The deadline for comments on the proposals is 8 December.

The Exposure Draft, Proposed Revisions to the Code Pertaining to the Offering and Accepting of Inducement is here.

Report by Pat Sweet

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