Question

Why do you think it is important that there should be a formal code of conduct guiding accounting behaviour ?

Answer 1

A code of conduct is a set of rules outlining the social norms, religious rules and responsibilities of, and or proper practices for, an individual.We all like to think we have personal ethics and know the difference between right and wrong.

Code of conduct and ethics consist of the morals and values concerned with human character and conduct, some of which would have been instilled in a person during childhood when parents influenced the way in which one act towards the people and environment around .It is a fact that personal ethics and code of conduct is unique to each of us. Therefore, in a professional context, we need guidance to help us decide what is "the right thing" to do – a framework or a code setting out principles of ethical behaviour and safeguarding compliance with those principles.

Most professionals are required to comply with an ethical code – in the case of ACCA, you will be required to comply by ACCA’s Code of Ethics and Conduct, which requires that our members uphold five fundamental ethical principles:

• Integrity:Demonstrating integrity means being straightforward and honest in all business and professional relationships. Upholding integrity requires that accountants do not associate themselves with information that they suspect is materially false or misleading — or that misleads by omission.
• Independence and Objectivity:Ethics and independence go hand in hand in the accounting profession. A critical component of trust is making unbiased decisions and recommendations that benefit the client. Conflicts of interest, for example, demand exposure under independence guidelines. Benefiting from the sale of one financial product over another could lead to a bias that skews financial advice to a client.To remain objective and independent, it is also necessary to ensure that recommendations are not subject to outside influence. An accountant’s professional judgment is compromised if they subordinate their judgment to someone else’s.
• Professional competence and due care:As technology, legislation and best practices change, a professional accountant must remain up to date. To exercise sound judgment, an accountant must stay abreast of developments that could affect a decision’s outcome.Practicing due care means recognizing your skill level and not suggesting that you have expertise in an area where you do not. Consulting with other professionals is a standard practice that helps to bond a network of individuals and generate respect.Similar guidelines also apply to accounting professionals who supervise others. These accountants must ensure that the subordinates receive proper training and guidance as they carry out their responsibilities.
• Confidentiality:Disclosure of financial information or revealing the disposition of a potential merger by an accounting professional without express permission violates the trust that is the foundation of a professional relationship — unless there is a legal or professional reason to do so.
• Professional Behaviour:Ethics require accounting professionals to comply with the laws and regulations that govern their jurisdictions and their bodies of work. Avoiding actions that could negatively affect the reputation of the profession is a reasonable commitment that business partners and others should expect.

These principles provide a framework to guide the professional accountant, and an expectation of ethical behaviour regardless of one’s personal ethical principles.This does not mean you need to ignore your personal values when at work.