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Ethics articles

On this page we present special articles on ethics, a selection of relevant articles from Accountancy Ireland, as well as recent news from across Chartered Accountants Ireland in relation to ethics.

Ethics and Governance
(?)

Get to grips with the revised Institute Code of Ethics

Karen Flannery and Níall Fitzgerald consider the critical points in the revised Chartered Accountants Ireland Code of Ethics, which came into effect on 1 March 2020. The revised Chartered Accountants Ireland Code of Ethics took effect on 1 March 2020. The revised Code was necessary to increase alignment with the International Ethics Standards Board for Accountants (IESBA) Code of Ethics, which underwent a significant restructure in recent years. While there are no changes to the fundamental principles, Chartered Accountants familiar with the previous Code of Ethics (effective September 2016 to 29 February 2020) will find the look and feel of the revised Code significantly different. While additional sections and emphasis were included, others were removed. This results in greater clarity and ease of navigation. Figure 1 provides an overview of the revised Chartered Accountants Ireland Code of Ethics. Added emphasis on fundamental principles The five fundamental principles of the Code of Ethics remain unchanged. These include integrity; objectivity; professional competence and due care; confidentiality, and; professional behaviour. The conceptual framework that describes the approach used to identify, evaluate and address threats to compliance with the fundamental principles also remains the same. However, there is now a heightened emphasis on the fundamental principles and the use of the overarching conceptual framework underlying each section of the Code. Before, much of the narrative was contained in a single section of the Code. Responding to non-compliance with laws and regulations New sections were added concerning non-compliance with laws and regulations (NOCLAR) for professional accountants in practice (Section 360) and professional accountants in business (Section 260). These bring the NOCLAR provisions of the IESBA Code of Ethics into the Institute’s Code. A vital feature of the NOCLAR provisions is the specific in-Code permission to breach the principle of confidentiality in the public interest. This permission has been explicit in the Institute’s Code for several years and so, the NOCLAR provisions can be seen as a change of detail rather than of substance. The new sections outline the required actions when NOCLAR is discovered and provide additional guidance in this area. Key points to note concerning the NOCLAR provisions are: The first response to identified NOCLAR is to raise the matter, and seek to address it, at the appropriate level within the relevant organisation (internally); Where NOCLAR is not dealt with appropriately internally, the professional accountant considers whether to report to an external authority in the public interest. The decision to report externally is (as it always has been) a complex one; and Where a report is made in the public interest and good faith, there is no breach of the confidentiality requirements of the Code of Ethics. However, there may be legal implications for the professional accountant to consider. Revised layout The most obvious change is the revised layout of the Code of Ethics, which now mirrors the structure of the IESBA Code of Ethics with additional material for members of Chartered Accountants Ireland. A new paragraph numbering format was introduced and as a result, sections were restructured (e.g. what was “Part C” (Professional Accountants in Business) is now “Part 2” in the revised Code).The revised layout facilitates more natural referencing and distinguishes between the Code’s requirements (in bold text and denoted by the letter ‘R’) and application material or guidance (indicated by the letter ‘A’). Complexity has been reduced by simplifying sentences and language in parts. Also a new ‘Guide to the Code’, explaining how it works, has been included. Other content changes Table 1 highlights other notable developments in the revised Code of Ethics and suggests where you might focus your attention depending on whether you are a member in practice or business. Retained Institute ‘add-on’ material Where existing Institute ‘add-on’ content created important additional requirements beyond the IESBA Code, these ‘add-on’ requirements are retained in the revised Code of Ethics. Such requirements include: Specific requirements regarding communicating with the predecessor accountant (Section 320); Particular obligations regarding transparency around the basis for fees and dealing with fee disputes (Section 330); and Agencies and referrals (Section 331). No new ‘add-on’ material was created. Additional support for members The Institute’s online Ethics Resource Centre is updated regularly with a range of supports and guidance for members. Additional information included in the old Code of Ethics, but removed in the revised Code and still considered useful, has been reproduced in a series of new Ethics Releases. The Ethics Releases are not a substitute for the requirements of the Code, but they do provide additional support for members in particular scenarios, including: Code of Ethics and changes in professional appointments; Code of Ethics and confidentiality; Code of Ethics and marketing of professional services; and Code of Ethics and corporate finance advice. Future updates The last substantial change to the Institute’s Code of Ethics was in 2016. While the Code does not change regularly, there is a significant body of work happening behind the scenes to ensure it remains appropriate, precise and effective in the context of the issues affecting the accounting profession. Members can, therefore, expect amendments from IESBA in the coming years; for example, considerations addressing the impact of technology-related ethics issues on the accounting profession. For members who are insolvency practitioners, a new Insolvency Code of Ethics is imminent. The current Code of Ethics for Insolvency Practitioners, appended as Part D of the Institute’s old Code of Ethics for members, remains in effect until then.  Actions speak louder than words It was evident from the Ethics Research Report, published by the Institute in January 2019, that members hold their professional and business ethics in high regard. While the Code of Ethics does not change regularly, it is a hallmark that establishes a minimum standard which is signed up to and shared by all members of the profession. It is useful to be familiar with its requirements and to remember that it is individual member actions that express commitment to the Code of Ethics in addition to a member’s personal ethics. The revised Code is available via the Institute’s Ethics Resource Centre.   Níall Fitzgerald FCA is Head of Ethics and Governance at Chartered Accountants Ireland.  Karen Flannery FCA is Head of Professional Standards Projects at Chartered Accountants Ireland.

Jul 05, 2022
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Ethics
(?)

New case studies bring the Code of Ethics to life

Members of Chartered Accountants Ireland are annually required to confirm that they are aware of their “obligations as set out in the Code of Ethics for members”. Accounting firms are required to indicate in their annual return whether they have “taken steps to ensure that all Principals, Employees and Subcontractors fully comply with the Institute’s Code of Ethics for Members”. A glance at the Regulation section of Accountancy Ireland reveals that non-compliance with the Code of Ethics is a frequent finding leading to disciplinary action against an individual member or firm. So how do you ensure you and all in the firm are familiar with the obligations as set out in the Code of Ethics? While reading the Code of Ethics is a good starting point, the current version is a long read at 202 pages, 261 if you include the obligations applying to insolvency practitioners. Recent research and engagement with accounting professionals on ethics has consistently identified training and illustrative case studies as the preferred supports for increasing familiarisation with the Code of Ethics. Professional accountants have expressed a preference for real-life examples and case studies which allow them to consider ethical dilemmas in a practical way, relevant to their own experience. The recent publication of five sets of ethical dilemmas case studies by the Consultative Committee of Accounting Bodies (CCAB), of which Chartered Accountants Ireland is a member, is a welcome response to this need. The case studies, which are applicable in both UK and Ireland, illustrate how the Code of Ethics can be applied by members working in business, not-for-profits, the public sector, public practice, and as non-executive directors. Each set contains several case studies tailored to reflect ethical dilemmas that can arise in the course of their professional work. They are designed to outline key principles and processes that can be considered when attempting to identify, evaluate and address ethical threats in line with the Code of Ethics. While more than one set of case studies may be relevant to an individual member, members in practice will appreciate the case studies exploring a range of ethical dilemmas tailored for professional accountants in public practice. This set explores the following ethical dilemmas: Case Study 1 explores the dilemma faced by a manager in relation to a very competent junior member of staff whose personal circumstances require her to take regular absences from work. This is having a negative impact on her colleagues, who are vocal about being overworked. Like other case studies in the set, it works through the dilemma in a structured manner, consistent with the conceptual framework outlined in the Code of Ethics, to: consider which of the five fundamental principles (integrity, confidentiality, professional behaviour, objectivity, professional competence and due care) are under threat; consider the relevant facts, which also involves seeking out information rather than solely relying on the information presented prima facie; identify affected parties, including considering the culture and reputation of the firm; determine who should be involved in the resolution and whether to consult with a colleague, external expert, or other trusted advisor; determine a possible course of action and implement, with the advice to document the steps taken in resolving the dilemma in case your ethical judgement is challenged in the future. Case Study 2 presents a dilemma faced by a partner in a three-partner firm. He discovers a client is not recording certain cash sales in their accounts. The case study examines the practical considerations including how to communicate the issue with the client and possible actions to take if the client is not receptive to the news. The commentary includes an outline of a thought process that prioritises the reputation of the firm, the five fundamental principles of the Code of Ethics, and relevant laws and regulations, to decide on the best advice for the client. This case also highlights the importance of considering legal reporting obligations, particularly in relation to anti-money laundering legislation and fraud. Case Study 3 tackles an ethical dilemma facing a sole practitioner who loses a local small business client (Company A) and is subsequently approached to help a local competitor of Company A (Company B) make an offer to buy their former client. This dilemma is compounded by the fact that Company A is struggling financially but this is not common knowledge. Also, the sole practitioner is acting as an alternate/continuity provider for another local sole practitioner, who is convalescing after a medical treatment. Company B is a client of the other practitioner. This case is a good example of how there can be several dimensions to an ethical dilemma, and the benefits of having a structured process in addressing such dilemmas. In Case Study 4, an accountant is advising a medium-sized group on a range of improvements to its operations and systems. After identifying a range of issues and preparing a report estimating the costs, the accountant becomes aware that the director with whom they are liaising has significantly understated these in a separate report to the board. The director does not share the accountant’s report with the board. This case requires consideration of to whom the accountant owes their fiduciary duty, and how they might discharge their duties and effectively manage their professional relationship with the client. Case Study 5 outlines a scenario in which a trainee accountant in a firm has been tasked with completing some complicated work within a very tight deadline in the lead-up to them taking study leave. While there are lessons to be learned for both parties, the case highlights that certain behaviour, which itself may be unethical, may give rise to further unethical behaviour directly impacting the quality of work for clients. In Case Study 6, a three-partner firm has a large audit client to whom it also provides non-audit services. There are substantial fees outstanding from the client and significant going-concern issues arise. Several issues are explored in this case, including that the audit planning section was not appropriately reviewed, that key information was missed, and that there is pressure to provide the bank with a clean audit opinion so it can extend the company’s overdraft facility. This is a situation in which more than one set of ethical obligations require consideration, in this case the Code of Ethics and the Ethical Standards for Auditors. Case Study 7 addresses suspected non-compliance with laws and regulations (NOCLAR), including bribery and cover-up of breaches of environmental laws and regulations, and considers any legal reporting obligations for the firm. The case highlights real issues that can arise, including dealing with pressure from clients to disregard any suspicions of noncompliance, desire to disassociate from illegal or unethical activity, deciding whether to override client confidentiality and report suspicions to the appropriate authorities, and balancing duties to the client with the public interest with safeguarding the reputation of the firm. CCAB’s Ethical Dilemma Case Studies provide an interesting and illuminating way to engage with the Code of Ethics while also increasing awareness of some threats to ethical conduct that can arise in an accountancy firm. Members are encouraged to use, read and apply them, and they can also be used by firms and/or training providers provided they are appropriately referenced. The case studies and other resources that can assist members in considering ethical dilemmas can be found on the Chartered Accountants Ireland Ethics Resource Centre. Níall Fitzgerald FCA Head of Ethics & Governance at Chartered Accountants Ireland

Apr 01, 2022
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Ethics
(?)

The Ukraine crisis: Ethical considerations for accountants

The Consultative Committee of Accountancy Bodies in Ireland (CCAB-I) and in the UK (CCAB) have issued statements to the accountancy profession following recent and ongoing developments in Ukraine. The statements: remind accountants of their legal and professional obligations, including ethical considerations, relating to the sanctions regimes and in managing their duties to clients, employers, and other stakeholders to cope with consequent disruptions; collate links to sanction lists, guidance and government advice in the UK, Ireland and the EU; highlight risks presented by current developments in the context of compliance with anti-money laundering legislation, the potential impact on professional indemnity insurance for members in practice, and the fast-moving nature and complexity of the situation and need to obtain specialist advice; refer to requirements in the Code of Ethics for Professional Accountants of particular relevance when an accountant is confronted with a dilemma or difficult situation concerning compliance with financial and trade sanctions and other restrictions. As people across the world condemn the attack by Russia on Ukraine, they also want to show their support through donations and using their influence for humanitarian intervention. Professional accountants will find themselves in positions of influence with many stakeholders including clients, employers, employees, and local communities.  The following are some considerations for accountants in this context: Fundraising for humanitarian or other reliefs People and organisations are looking to help the millions of Ukrainians displaced by the invasion by donating directly or running fundraiser events. Be aware of fraud risk and recommend controls that ensure the safeguard of any monies raised and that they are used for the purpose for which they were raised. Ensure the necessary licences are obtained for any public fundraising activity. Be clear on the purpose for the funds and how they will be channelled to the beneficiaries. Ensure compliance with charity law and check that charitable donations are only made to a properly registered charity (Register of Charities: Charities Regulator (Republic of Ireland) and The Charity Commission for Northern Ireland).   Social Media Understandably, many people and corporates are sharing their views on Russia's invasion of Ukraine via social media. The distinction between when a view is a personal view or that of the organisation where a person works is not always clear. If you are an officer of a company, e.g. a director, chief executive, or the public relations officer, and you are commenting on a matter related to your area of responsibility, then it is very difficult to separate your view from the corporate view. For this reason, many organisations will have clear corporate social media policies in place and that is the first reference point if in doubt. However, before reacting to a colleague's personal post, it is important to also consider their right to hold and express an opinion. There can be a cultural aspect to this within an organisation, especially where respect, tolerance, diversity and inclusion, and psychological safety are highly valued. The specific circumstances of the person expressing the view might also be taken into account, for example their emotional proximity to the issue.   Developing Corporate Positions Many organisations are using their influence for good by publicly denouncing the invasion of Ukraine, with some going further to withdraw from investments and business operations in Russia, and any dealings with Russian state-owned entities. These decisions are not always the most straightforward to implement. Legal and other expert advice should be sought to consider how an organisation can address contractual obligations, restructure, and relocate operations. Many Russian citizens are against the actions of the Russian Government, and Russian employees, contractors, etc., should receive fair treatment and not be discriminated against. Reporting progress and being transparent on these positions, including any setbacks, is very important as corporates will be held to account by stakeholders and members of the public to honour their commitments. Careful thought should be given before making any wide-sweeping statements. The global economy, with its complex interconnected markets, creates practical difficulties when seeking to divest of everything connected to Russia.   Whistleblowing and Speaking Up Clearly defined and well-communicated whistleblowing and speaking-up policies and procedures can increase an organisation’s awareness of how it may be exposed to the issues highlighted in the CCAB/CCAB–I statements referred to above. Communicating to employees the organisation’s position in relation to this crisis and reminding them about whistleblowing and speaking-up policies and procedures, promotes a safe environment in which individuals feel comfortable to raise any concerns about the organisation’s actions, or inactions.   Corporate Reporting While the scale of the impact of this crisis on organisations will differ, it will be dwarfed by the impact on millions of Ukrainians. Organisations have important social obligations and responsibilities to corporate stakeholders. Accountants should ensure transparency and accountability in corporate reporting by highlighting the impact of the crisis on the organisation’s operations, asset valuations and exposure to liabilities. Examples of the sources of this impact include: supply-chain disruption; the cost of ceasing operations in Russia or the conflict/invasion zones; rising commodity prices; inaccessibility of certain markets due to trade or travel restrictions; difficulty maintaining required levels of capital reserves; and loss of key customers. Accountants will have a central role in collecting, measuring, and reporting the necessary information and ensuring it is reported in accordance with legal and regulatory requirements and relevant reporting frameworks. They should also understand the limitations to their expertise and call for the involvement of experts where necessary. Directors and senior management will need to consider expert advice when making highly judgemental decisions on values and estimates and in determining the future implications for the organisation.   Boundaries between Personal Life and Professional Life Negative emotions, such as anger and fear, increase the risk of self-defeating behaviours. The developing situation in Ukraine will understandably evoke such emotions in many. In this context, it is useful to refer to guidance issued by the CCAB bodies, in July 2021, to help accountants consider and distinguish if their personal behaviour could be viewed as conduct that might discredit the profession. While the facts and circumstances of every situation will differ, the CCAB guidance provides some examples of such behaviours, including the use of seriously offensive or threatening language causing distress, or threatening behaviour, towards a client or a member of the public outside of the work environment. This non-exhaustive list of considerations may need to be reconsidered as the crisis in Ukraine develops. In many situations, increasing ethical awareness or the ability to address an ethical dilemma requires reflection. Professional accountants may find it useful to refer to, or circulate to professional accountancy staff, the Chartered Accountants Ireland Ethics Quick Reference Guide available from our Ethics Resource Centre. Níall Fitzgerald FCA, Head of Ethics and Corporate Governance Update: Chartered Accountants Ireland have created a dedicated page collating key information on sanctions in response to the crisis in Ukraine.

Mar 09, 2022
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12

Accountancy Ireland articles on ethics

Ethics and Governance
(?)

New era for credit unions

A mainstay of Ireland’s financial services landscape for over 60 years, our credit unions are entering an exciting phase with recent developments presenting new opportunities to adapt and change Credit unions are an important part of the financial services landscape. With offices a common feature of cities, towns and villages throughout Ireland, they play a key role in the day-to-day finances of many Irish people and communities. There are more than 3.6 million credit union members on the island of Ireland.  A history of credit unions Credit unions were first established in Ireland in the late 1950s and quickly became a repository for savings and a source of loans for many people. The total value of loans extended by credit unions in the Republic of Ireland is currently around €5 billion, with total savings coming to about €16 billion.  Average sector total reserves, as a percentage of total assets, is approximately 16 percent, which serves to underpin the confidence of their members, particularly in times of uncertainty and disruptive change. These institutions are not-for-profit financial co-operatives. They are owned and controlled by their members and therefore have a different business model to retail banks. Each credit union is independent, with its own board of directors, charged with overall responsibility for running the credit union.  Because they are part of the financial services sector, credit unions are governed by legislation in Ireland, principally the Credit Union Act 1997, as amended, and regulated by the Central Bank.  Significant amendments to the 1997 Act were introduced by the Credit Union and Co-operation with Overseas Regulators Act 2012, and this is the legislative regime under which credit unions currently operate. The credit union sector has been relatively stable in terms of any legislative or government policy changes. However, two recent developments, the Credit Union (Amendment) Bill 2022 and the Retail Banking Review (November 2022), present new opportunities for credit unions to adapt and change their business models and enhance their product and service offerings to members. The Credit Union (Amendment) Bill 2022 The first major legislative change for credit unions since the 2012 Act, the Credit Union (Amendment) Bill 2022 (the Bill) was published on 30 November 2022 following over two years of stakeholder engagement, with over 100 proposals considered. Highly technical and not an easy read, the Bill is currently before the Dáil, where proposals for amendments will be considered.  There is no fixed timeline for enactment and, post-enactment, commencement of sections may occur in phases, with the Central Bank of Ireland having to amend regulations to accommodate the new provisions.  The main provisions of the Bill involve: the establishment of ‘corporate credit unions’; amending the requirements and qualifications for membership of credit unions; altering the scope of permitted investments by credit unions; changes to the governance of credit unions; maximum interest rates on loans by credit unions; provision of services by credit unions to members of other credit unions; and participation by credit unions in loans to members of other credit unions. Collaboration between credit unions The introduction of ‘corporate credit unions’ should support greater collaboration between credit unions, facilitating a pooling of resources and greater access to funding.  A new form of regulated entity, their membership would be restricted to other credit unions, with lending allowed only to those members. Further collaboration is envisaged with a provision in the Bill allowing all credit unions to refer members to other credit unions to avail of a service that the original credit union does not provide.  While such referral is not mandatory, it is a new option for making additional services available to members—for example, a current account facility where the original credit union may be reluctant to provide this service to all members based on cost or other reasons.  Another provision enabling collaboration allows a credit union to participate in a loan to a member of another credit union. This will facilitate risk sharing associated with the loan and will make it easier for an individual credit union to offer larger loans to its members.  Regarding lending to businesses, and other organisations or associations, there is a further key provision in the Bill for “bodies” (incorporated or unincorporated) to be allowed join a credit union with the same rights and obligations as a “natural person” (member).  This is, however, subject to conditions that a majority of the members of the body would be eligible to join the credit union and the body meets the common bond requirement. Ultimately, this will make it easier for credit unions to lend to such bodies and is principally focused on SMEs. While none of these changes are mandatory, they do provide new options and opportunities for credit unions. Governance changes Regarding changes in governance, two provisions stand out: the option to appoint the manager (chief executive officer) of the credit union to the board; and  reduction of the minimum number of board meetings per year to six, down from the current 10.   The extent to which these changes will be adopted remains to be seen, as many credit union boards may be content with the existing practice.   Where a credit union decides to include its manager as a board member, the Bill proposes that this will be done by their direct appointment to the board and not by election at a general meeting of members.  The term can be for any length but cannot extend beyond the individual’s term as manager.  One restriction on the manager as a board member is that they cannot sit on the nomination committee of the credit union, the membership of which is restricted to board members who have been co-opted or elected at general meetings.  Similarly, regarding the frequency of board meetings, the board may be reluctant to change the current practice of having at least one meeting per month, concluding that it cannot adequately carry out its responsibilities with only six board meetings.  Because of the voluntary ethos of credit unions, the historically close involvement of board members with the credit union, and the relatively onerous responsibilities of boards, it may take some time before six board meetings is considered the norm. Other governance changes proposed by the 2022 Bill include reducing the number of board oversight committee meetings, removing the requirement for the board oversight committee to sign the audited annual accounts, and extending from annually to every three years the review of specific policies by the board. The Credit Union (Amendment) Bill 2022 includes substantive policy change in the areas of collaboration, members’ services, and governance. It seeks to give more power to credit unions to determine strategy and, when enacted, will require consequential changes to Central Bank regulations.  To fully exploit the options and opportunities enabled by its provisions will require significant work by the sector. The Retail Banking Review 2022 In November 2022, following its approval by Government, Minister for Finance, Paschal Donohoe, and Minister of State for Financial Services, Credit Unions and Insurance, Sean Fleming, published the report of the Retail Banking Review (the Review).  Driven by the departure of two major banks, Ulster Bank and KBC, this is a broad-ranging review of the retail banking sector in Ireland, including the credit union sector.  In relation to credit unions, the Review states: “Credit unions have a strong and trusted brand, they are present in communities throughout the country, and have been developing their product offering. The credit unions are already a significant player in consumer credit, and they are making inroads in the current account, mortgages and SME segments of the market. These developments, coupled with their collectively strong levels of capital and deposit bases, leads the Review Team to believe that credit unions could play a greater role in the provision of retail banking products and services in the coming years.” Referencing the Credit Union (Amendment) Bill 2022, the Review recommends that the credit union sector develop a strategic plan to deliver business model changes that would enable it to sustainably provide a universal product offering to all credit union members. Provided directly or on a referral basis, this would continue to be community-based. The Review suggests that such a strategic plan should show how credit unions can: viably scale their business model in key product areas such as mortgages and SME lending; invest in expertise, systems, controls, and processes to deliver standard products and services across all credit unions, while managing any risks arising and continuing to protect members’ savings; provide the option of in-branch services for members of all credit unions. Both the Bill and the Review point to new opportunities for credit unions and demonstrate confidence in their future as part of the Irish financial services sector. For these opportunities to be successfully managed, however, credit unions must continue to maintain high levels of governance so that legislators, the Central Bank, their members, and the wider community can have confidence in the sector.  Credit unions have done much for many people in Ireland for more than 60 years. These developments in legislation and government policy point to their continued and increasing relevance in the years ahead. Gene Boyd, FCA, is a risk management consultant and author of The Governance of Credit Unions in Ireland

Feb 08, 2023
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Ethics and Governance
(?)

Roadmap to Corporate Sustainability Reporting

The roadmap for the EU Commission’s milestone Corporate Sustainability Reporting Directive is taking shape and now is the time to start preparing for a brave new era in non-financial reporting, writes Conor Holland With the Corporate Sustainability Reporting Directive (CSRD) now approved by the European Council, entities in the EU must begin to invest significant time and resources in preparing for the advent of a new era in non-financial reporting, which places the public disclosure of environmental, social affairs and governance matters (ESG) matters on a par with financial information. Under the CSRD, entities will have to disclose much more sustainability-related information about their business models, strategy and supply chains than they have to date. They will also need to report ESG information in a standardised format that can be assured by an independent third party. For those charged with governance, the CSRD will bring further augmented requirements. Audit committees will need to oversee new reporting processes and monitor the effectiveness of systems and controls setup. They will also have enhanced responsibilities. Along with monitoring an entity’s ESG reporting process, and evaluating the integrity of the sustainability information reported by that entity, audit committees will need to: Monitor the effectiveness of the entity’s internal quality control and risk management systems and internal audit functions; Monitor the assurance of annual and consolidated sustainability reporting; Inform the entity’s administrative or supervisory body of the outcome of the assurance of sustainability reporting; and Review and monitor the independence of the assurance provider. The CSRD stipulates the requirement for limited assurance over the reported information. However, it also includes the option for assurance requirements to evolve to reasonable assurance at a later stage. The EU estimates that 49,000 companies across the EU will fall under the requirements of the new CSRD Directive, compared to the 11,600 companies that currently have reporting obligations. The EU has confirmed that the implementation of the CSRD will take place in three stages: 1 January 2024 for companies already subject to the non-financial reporting directive (reporting in 2025 for the financial year 2024); 1 January 2025 for large companies that are not presently subject to the non-financial reporting directive (reporting in 2026 for the financial year 2025); 1 January 2026 for listed SMEs, small and non-complex credit institutions, and captive insurance undertakings (reporting in 2027 for the financial year 2026). A large undertaking is defined as an entity that exceeds at least two of the following criteria: A net turnover of €40 million A balance sheet total of €20 million 250 employees on average over the financial year The final text of the CSRD has also set timelines for when the Commission should adopt further delegated acts on reporting standards, with 30 June 2023 set as the date by which the Commission should adopt delegated acts specifying the information that undertakings will be required to report. European Financial Reporting Advisory Group In tandem, the European Financial Reporting Advisory Group (EFRAG) is working on a first set of draft sustainability reporting standards (ESRS). These draft standards will be ready for consideration by the Commission once the Parliament and Council have agreed a legislative text. The current draft standards provide an outline as to the depth and breadth of what entities will be required to report. Significantly, the ESRS should be considered as analogous to accountancy standards—with detailed disclosure requirements (qualitative and quantitative), a conceptual framework and associated application guidance. Readers should take note—the ESRS are much more than a handful of metrics supplementary to the financial statements. They represent a step change in what corporate reporting entails, moving non-financial information toward an equilibrium with financial information. Moreover, the reporting boundaries would be based on financial statements but expanded significantly for the upstream and downstream value chain, meaning an entity would need to capture material sustainability matters that are connected to the entity by its direct or indirect business relationships, regardless of its level of control over them. While the standards and associated requirements are now largely finalised, in early November 2022, EFRAG published a revised iteration to the draft ESRS, introducing certain changes to the original draft standards. While the broad requirements and content remain largely the same, some notable changes include: Structure of the reporting areas has been aligned with TCFD (Task Force on Climate-Related Financial Disclosures) and ISSB (International Sustainability Standards Board) standards – specifically, the ESRS will be tailored around “governance”, “strategy”, “management of impacts, risks and opportunities”, and “metrics and targets”. Definition of financial materiality is now more closely aligned to ISSB standards. Impact materiality is more commensurate with the GRI (Global Reporting Initiative) definition of impact materiality. Time horizons are now just a recommendation; entities may deviate and would disclose their entity-specific time horizons used. Incorporation of one governance standard into the cross-cutting standard requirements on the reporting area of governance. Slight reduction in the number of data points required within the disclosure requirements. ESRS and international standards By adopting double materiality principles, the proposed ESRS consider a wider range of stakeholders than IFRS® Sustainability Disclosure Standards or the US Securities and Exchange Commission (SEC) published proposal. Instead, they aim to meet public policy objectives as well as meeting the needs of capital markets. It is the ISSB’s aim to create a global baseline for sustainability reporting standards that allows local standard setters to add additional requirements (building blocks), rather than face a coexistence of multiple separate frameworks. The CSRD requires EFRAG to take account of global standard-setting initiatives to the greatest extent possible. In this regard, EFRAG has published a comparison with the ISSB’s proposals and committed to joining an ISSB working group to drive global alignment. However, in the short term, entities and investors may potentially have to deal with three sets of sustainability reporting standards in setting up their reporting processes, controls, and governance. Key differences The proposed ESRS list detailed disclosure requirements for all ESG topics. The proposed IFRS Sustainability Disclosure Standards would also require disclosure in relation to all relevant ESG topics, but the ISSB has to date only prepared a detailed exposure draft on climate, asking preparers to consider general requirements and other sources of information to report on other sustainability topics. The SEC focused on climate in its recent proposal. The proposed ESRS are more prescriptive, and the number of disclosure requirements significantly exceeds those in the proposed IFRS Sustainability Disclosure Standards. Whereas the proposed IFRS Sustainability Disclosure Standards are intended to focus on the information needs of capital markets, ESRS also aim to address the policy objectives of the EU by addressing wider stakeholder needs. Given the significance of the directive—and the remaining time to get ready for it—entities should now start preparing for its implementation. It is important that entities develop plans to understand the full extent of the CSRD requirements, and the implications for their reporting infrastructure. As such, they should take some immediate steps to prepare, and consider: Performing a gap analysis—i.e. what the entity reports today, contrasted with what will be required under the CSRD. This is a useful exercise to inform entities on where resources should be directed, including how management identify sustainability-related information, and what KPIs they will be required to report on. Undertaking a ‘double materiality’ analysis to identify what topics would be considered material from an impact and financial perspective—as required under the CSRD. Get ‘assurance ready’—entities will need to be comfortable that processes and controls exist to support ESG information, and that the information can ultimately be assured. The Corporate Sustainability Reporting Directive represents a fundamental change in the nature of corporate reporting—the time to act is now and the first deadline is closing in.

Dec 02, 2022
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Ethics and Governance
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Whistleblowing policy and process – what you need to know

Companies preparing for the commencement of the Protected Disclosures (Amendment) Act 2022 in the New Year will need to overhaul whistleblowing policies and processes, but the effort will bring clear benefits, writes Gráinne Madden Encouraging people in an organisation to speak up about their concerns should be a no-brainer. Why would an organisation not want to know about a potential risk? Why would an organisation want an employee to feel the need to go to an external body, such as a regulator or the media, to highlight internal problems? International research repeatedly reinforces that there are two main reasons why people fail to speak up about their suspicions of wrongdoing. First, there is the fear of retaliation. Current Irish and UK law is seeking to address this by offering protection. The second reason people fail to speak up about their suspicions of wrongdoing in an organisation is fear of futility. This is the fear that nothing will be done, even if they do speak up—and this is why having clear policies and processes in place is so important.  The absence of a whistleblowing policy and process in an organisation will certainly send the message that the organisation does not really want to hear about any problematic issues that may exist or arise.  As it stands, in Ireland and the UK, workers are entitled to legal protection against dismissal, or other reprisal from their employer or colleagues, when disclosing concerns about certain issues. Until now, however—except in certain sector-specific areas—most organisations have not been required to put a whistleblowing policy or procedures in place, or to follow up on such disclosures.  The EU Whistleblowing Directive will, however, bring major changes to which organisations operating in EU jurisdictions must now respond. In Ireland, the Protected Disclosures (Amendment) Act 2022 will commence on 1 January 2023, giving effect to the EU Directive. New requirements for organisations There are several key additional requirements that will apply to organisations under the new Act, which are considered below. Employee thresholds For workplaces with more than 50 employees, there will be a requirement to have formal channels and procedures for receiving and, crucially, following up on disclosures. Workplaces with between 50 and 249 employees have until December 2023 to comply, and 250-plus employee workplaces must comply at commencement.  However, all organisations operating in certain sectors will be required to comply at commencement, even those employing fewer than 50 people. This includes:  public bodies; companies subject to EU laws in the areas of financial services, prevention of money-laundering and terrorist financing; transport safety; and protection of the environment (offshore oil and gas installations and operations only). The 2022 Act states that the Minister for Public Expenditure and Reform may, by order, reduce the threshold of 50 employees for specified classes of employers, subject to a risk assessment and public consultation.  Change of definitions and burden of proof Under the new Act, the scope of protected persons will be extended to include non-executive members, shareholders, volunteers, and ‘pre-contractual’ employees, such as candidates applying for a job during the recruitment process before the work-based relationship even begins. Further, retaliation will be more broadly defined. In respect of alleged detriment (be it an act or omission) caused to a person because of the making of a protected disclosure, the employer will have to prove that the detriment complained of was not in retaliation for, or because of, the person having made a protected disclosure.  Administration and staff Confidentiality regarding whistleblowing must be respected by all reporting systems and access to data by non-authorised staff prevented. For staff who are authorised, appropriate training must be given in respect of the handling of reports. Finally, records must be kept of all reports, as well as ensuring follow-up and feedback regarding these reports within certain timeframes.  Blending culture with policy The required process management will mean that many organisations will need to implement issue management systems. Simply having a policy and process in place isn’t, however, going to be an encouragement for nervous employees. Creating a culture in which people feel safe in speaking up—and feel that their concerns are welcomed—is far more important.  So, in addition to having a sound policy and process in place, what other steps should employers consider? Here are seven recommendations: Train managers and team leads to recognise when an issue could be a protected disclosure and, most importantly, to receive reports of potential issues in a calm and welcoming way. Word can spread very quickly about managers not being open to bad news. Think about how whistleblowing is discussed in the organisation and consider whether it is healthy or whether the narrative needs to be changed. Any pejorative language in connection with whistleblowing or speaking up needs to be identified and stamped out. The focus must be on recognising that people who bring risks to our attention are doing the organisation a great favour. It is worth highlighting that research demonstrates that the people who blow the whistle tend to be the most loyal employees who care greatly about the organisation. Ensure that the confidentiality regime is well- communicated and respected so that employees can be confident their identity will not become known if they disclose an issue. Do not become complacent if the whistleblowing policy is not used—rather than indicating a spotless organisation, it could be signalling a poor work culture where people either fear speaking up or just don’t care enough to bother. Remove any ‘good faith’ requirement from policies. The focus should be on the issue reported, not the motivation of the person reporting. Furthermore, there is no ‘good faith’ obligation under Irish or UK law or the directive. Make sure that penalisation is not tolerated. State this clearly in the whistleblowing and speaking-up policy, making sure there are clearly defined processes for reporting claims of penalisation and for following up on claims of penalisation. Provide feedback to a discloser on any action taken in response to their disclosure. The ability to do this will depend on the nature of the issue and the rights to confidentiality of other parties. At the very least, a discloser should be reassured that their concerns have been dealt with appropriately. It is likely that most organisations will need to overhaul their whistleblowing policies and processes in response to the Protected Disclosures (Amendment) Act 2022. The requirements may seem daunting, but help and advice on good practice is available. The benefits are clear, not just in terms of risk management and protection of brand and reputation, but also for the common good.

Dec 02, 2022
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Ethics and Governance
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Get to grips with the revised Institute Code of Ethics

Karen Flannery and Níall Fitzgerald consider the critical points in the revised Chartered Accountants Ireland Code of Ethics, which came into effect on 1 March 2020. The revised Chartered Accountants Ireland Code of Ethics took effect on 1 March 2020. The revised Code was necessary to increase alignment with the International Ethics Standards Board for Accountants (IESBA) Code of Ethics, which underwent a significant restructure in recent years. While there are no changes to the fundamental principles, Chartered Accountants familiar with the previous Code of Ethics (effective September 2016 to 29 February 2020) will find the look and feel of the revised Code significantly different. While additional sections and emphasis were included, others were removed. This results in greater clarity and ease of navigation. Figure 1 provides an overview of the revised Chartered Accountants Ireland Code of Ethics. Added emphasis on fundamental principles The five fundamental principles of the Code of Ethics remain unchanged. These include integrity; objectivity; professional competence and due care; confidentiality, and; professional behaviour. The conceptual framework that describes the approach used to identify, evaluate and address threats to compliance with the fundamental principles also remains the same. However, there is now a heightened emphasis on the fundamental principles and the use of the overarching conceptual framework underlying each section of the Code. Before, much of the narrative was contained in a single section of the Code. Responding to non-compliance with laws and regulations New sections were added concerning non-compliance with laws and regulations (NOCLAR) for professional accountants in practice (Section 360) and professional accountants in business (Section 260). These bring the NOCLAR provisions of the IESBA Code of Ethics into the Institute’s Code. A vital feature of the NOCLAR provisions is the specific in-Code permission to breach the principle of confidentiality in the public interest. This permission has been explicit in the Institute’s Code for several years and so, the NOCLAR provisions can be seen as a change of detail rather than of substance. The new sections outline the required actions when NOCLAR is discovered and provide additional guidance in this area. Key points to note concerning the NOCLAR provisions are: The first response to identified NOCLAR is to raise the matter, and seek to address it, at the appropriate level within the relevant organisation (internally); Where NOCLAR is not dealt with appropriately internally, the professional accountant considers whether to report to an external authority in the public interest. The decision to report externally is (as it always has been) a complex one; and Where a report is made in the public interest and good faith, there is no breach of the confidentiality requirements of the Code of Ethics. However, there may be legal implications for the professional accountant to consider. Revised layout The most obvious change is the revised layout of the Code of Ethics, which now mirrors the structure of the IESBA Code of Ethics with additional material for members of Chartered Accountants Ireland. A new paragraph numbering format was introduced and as a result, sections were restructured (e.g. what was “Part C” (Professional Accountants in Business) is now “Part 2” in the revised Code).The revised layout facilitates more natural referencing and distinguishes between the Code’s requirements (in bold text and denoted by the letter ‘R’) and application material or guidance (indicated by the letter ‘A’). Complexity has been reduced by simplifying sentences and language in parts. Also a new ‘Guide to the Code’, explaining how it works, has been included. Other content changes Table 1 highlights other notable developments in the revised Code of Ethics and suggests where you might focus your attention depending on whether you are a member in practice or business. Retained Institute ‘add-on’ material Where existing Institute ‘add-on’ content created important additional requirements beyond the IESBA Code, these ‘add-on’ requirements are retained in the revised Code of Ethics. Such requirements include: Specific requirements regarding communicating with the predecessor accountant (Section 320); Particular obligations regarding transparency around the basis for fees and dealing with fee disputes (Section 330); and Agencies and referrals (Section 331). No new ‘add-on’ material was created. Additional support for members The Institute’s online Ethics Resource Centre is updated regularly with a range of supports and guidance for members. Additional information included in the old Code of Ethics, but removed in the revised Code and still considered useful, has been reproduced in a series of new Ethics Releases. The Ethics Releases are not a substitute for the requirements of the Code, but they do provide additional support for members in particular scenarios, including: Code of Ethics and changes in professional appointments; Code of Ethics and confidentiality; Code of Ethics and marketing of professional services; and Code of Ethics and corporate finance advice. Future updates The last substantial change to the Institute’s Code of Ethics was in 2016. While the Code does not change regularly, there is a significant body of work happening behind the scenes to ensure it remains appropriate, precise and effective in the context of the issues affecting the accounting profession. Members can, therefore, expect amendments from IESBA in the coming years; for example, considerations addressing the impact of technology-related ethics issues on the accounting profession. For members who are insolvency practitioners, a new Insolvency Code of Ethics is imminent. The current Code of Ethics for Insolvency Practitioners, appended as Part D of the Institute’s old Code of Ethics for members, remains in effect until then.  Actions speak louder than words It was evident from the Ethics Research Report, published by the Institute in January 2019, that members hold their professional and business ethics in high regard. While the Code of Ethics does not change regularly, it is a hallmark that establishes a minimum standard which is signed up to and shared by all members of the profession. It is useful to be familiar with its requirements and to remember that it is individual member actions that express commitment to the Code of Ethics in addition to a member’s personal ethics. The revised Code is available via the Institute’s Ethics Resource Centre.   Níall Fitzgerald FCA is Head of Ethics and Governance at Chartered Accountants Ireland.  Karen Flannery FCA is Head of Professional Standards Projects at Chartered Accountants Ireland.

Jul 05, 2022
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Ethics
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The Ukraine crisis: Ethical considerations for accountants working overseas

As people across the world condemn the attack by Russia on Ukraine, they also want to show their support through donations and using their influence for humanitarian intervention. Professional accountants will find themselves in positions of influence with many stakeholders including clients, employers, employees, and local communities.  Níall Fitzgerald, Head of Ethics and Governance outlines some practical considerations for accountants and business leaders in this context:    Fundraising for humanitarian or other reliefs People and organisations are looking to help the millions of Ukrainians displaced by the invasion by donating directly or running fundraiser events. Be aware of fraud risk and recommend controls that ensure the safeguard of any monies raised and that they are used for the purpose for which they were raised. Ensure the necessary licences are obtained for any public fundraising activity. Be clear on the purpose for the funds and how they will be channelled to the beneficiaries. Ensure compliance with national charity law and check that charitable donations are only made to a properly registered charity in your jurisdiction. Social media Understandably, many people and corporates are sharing their views on Russia's  invasion of Ukraine via social media. The distinction between when a view is a personal view or that of the organisation where a person works is not always clear. If you are an officer of a company, e.g. a director, chief executive, or the public relations officer, and you are commenting on a matter related to your area of responsibility, then it is very difficult to separate your view from the corporate view. For this reason, many organisations will have clear corporate social media policies in place and that is the first reference point if in doubt. However, before reacting to a colleague's personal post, it is important to also consider their right to hold and express an opinion. There can be a cultural aspect to this within an organisation, especially where respect, tolerance, diversity and inclusion, and psychological safety are highly valued. The specific circumstances of the person expressing the view might also be taken into account, for example their emotional proximity to the issue.  Developing corporate positions Many organisations are using their influence for good by publicly denouncing the invasion of Ukraine, with some going further to withdraw from investments and business operations in Russia, and any dealings with Russian state-owned entities. These decisions are not always the most straightforward to implement. Legal and other expert advice should be sought to consider how an organisation can address contractual obligations, restructure, and relocate operations. Many Russian citizens are against the actions of the Russian Government, and Russian employees, contractors, etc., should receive fair treatment and not be discriminated against. Reporting progress and being transparent on these positions, including any setbacks, is very important as corporates will be held to account by stakeholders and members of the public to honour their commitments. Careful thought should be given before making any wide-sweeping statements. The global economy, with its complex interconnected markets, creates practical difficulties when seeking to divest of everything connected to Russia.   Whistleblowing and speaking up Clearly defined and well-communicated whistleblowing and speaking-up policies and procedures can increase an organisation’s awareness of any weaknesses in it’s internal controls and practices relating to sanctions, anti-money and anti-bribery and corruption compliance. Communicating to employees the organisation’s position in relation to this crisis and reminding them about whistleblowing and speaking-up policies and procedures, promotes a safe environment in which individuals feel comfortable to raise any concerns about the organisation’s actions, or inactions. Corporate reporting While the scale of the impact of this crisis on organisations will differ, it will dwarfed by the impact on millions of Ukrainians. Organisations have important social obligations and responsibilities to corporate stakeholders. Accountants should ensure transparency and accountability in corporate reporting by highlighting the impact of the crisis on the organisation’s operations, asset valuations and exposure to liabilities. Examples of the sources of this impact include: supply-chain disruption; the cost of ceasing operations in Russia or the conflict/invasion zones; rising commodity prices; inaccessibility of certain markets due to trade or travel restrictions; difficulty maintaining required levels of capital reserves; and loss of key customers. Accountants will have a central role in collecting, measuring, and reporting the necessary information and ensuring it is reported in accordance with legal and regulatory requirements and relevant reporting frameworks. They should also understand the limitations to their expertise and call for the involvement of experts where necessary. Directors and senior management will need to consider expert advice when making highly judgemental decisions on values and estimates and in determining the future implications for the organisation.    Boundaries between personal life and professional life Negative emotions, such as anger and fear, increase the risk of self-defeating behaviours. The developing situation in Ukraine will understandably evoke such emotions in many. In this context, it is useful to refer to guidance issued by the CCAB bodies, in July 2021, to help accountants consider and distinguish if their personal behaviour could be viewed as conduct that might discredit the profession. While the facts and circumstances of every situation will differ, the CCAB guidance provides some examples of such behaviours, including the use of seriously offensive or threatening language causing distress, or threatening behaviour, towards a client or a member of the public outside of the work environment.  This non-exhaustive list of considerations may need to be reconsidered as the crisis in Ukraine develops. In many situations, increasing ethical awareness or the ability to address an ethical dilemma requires reflection. Professional accountants may find it useful to refer to, or circulate to professional accountancy staff, the Chartered Accountants Ireland Ethics Quick Reference Guide available from our Ethics Resource Centre. This article was adapted for members overseas from an article written by Níall Fitzgerald on the Institute’s Ethics Resource Centre.

Apr 26, 2022
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Ethics
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New case studies bring the Code of Ethics to life

Members of Chartered Accountants Ireland are annually required to confirm that they are aware of their “obligations as set out in the Code of Ethics for members”. Accounting firms are required to indicate in their annual return whether they have “taken steps to ensure that all Principals, Employees and Subcontractors fully comply with the Institute’s Code of Ethics for Members”. A glance at the Regulation section of Accountancy Ireland reveals that non-compliance with the Code of Ethics is a frequent finding leading to disciplinary action against an individual member or firm. So how do you ensure you and all in the firm are familiar with the obligations as set out in the Code of Ethics? While reading the Code of Ethics is a good starting point, the current version is a long read at 202 pages, 261 if you include the obligations applying to insolvency practitioners. Recent research and engagement with accounting professionals on ethics has consistently identified training and illustrative case studies as the preferred supports for increasing familiarisation with the Code of Ethics. Professional accountants have expressed a preference for real-life examples and case studies which allow them to consider ethical dilemmas in a practical way, relevant to their own experience. The recent publication of five sets of ethical dilemmas case studies by the Consultative Committee of Accounting Bodies (CCAB), of which Chartered Accountants Ireland is a member, is a welcome response to this need. The case studies, which are applicable in both UK and Ireland, illustrate how the Code of Ethics can be applied by members working in business, not-for-profits, the public sector, public practice, and as non-executive directors. Each set contains several case studies tailored to reflect ethical dilemmas that can arise in the course of their professional work. They are designed to outline key principles and processes that can be considered when attempting to identify, evaluate and address ethical threats in line with the Code of Ethics. While more than one set of case studies may be relevant to an individual member, members in practice will appreciate the case studies exploring a range of ethical dilemmas tailored for professional accountants in public practice. This set explores the following ethical dilemmas: Case Study 1 explores the dilemma faced by a manager in relation to a very competent junior member of staff whose personal circumstances require her to take regular absences from work. This is having a negative impact on her colleagues, who are vocal about being overworked. Like other case studies in the set, it works through the dilemma in a structured manner, consistent with the conceptual framework outlined in the Code of Ethics, to: consider which of the five fundamental principles (integrity, confidentiality, professional behaviour, objectivity, professional competence and due care) are under threat; consider the relevant facts, which also involves seeking out information rather than solely relying on the information presented prima facie; identify affected parties, including considering the culture and reputation of the firm; determine who should be involved in the resolution and whether to consult with a colleague, external expert, or other trusted advisor; determine a possible course of action and implement, with the advice to document the steps taken in resolving the dilemma in case your ethical judgement is challenged in the future. Case Study 2 presents a dilemma faced by a partner in a three-partner firm. He discovers a client is not recording certain cash sales in their accounts. The case study examines the practical considerations including how to communicate the issue with the client and possible actions to take if the client is not receptive to the news. The commentary includes an outline of a thought process that prioritises the reputation of the firm, the five fundamental principles of the Code of Ethics, and relevant laws and regulations, to decide on the best advice for the client. This case also highlights the importance of considering legal reporting obligations, particularly in relation to anti-money laundering legislation and fraud. Case Study 3 tackles an ethical dilemma facing a sole practitioner who loses a local small business client (Company A) and is subsequently approached to help a local competitor of Company A (Company B) make an offer to buy their former client. This dilemma is compounded by the fact that Company A is struggling financially but this is not common knowledge. Also, the sole practitioner is acting as an alternate/continuity provider for another local sole practitioner, who is convalescing after a medical treatment. Company B is a client of the other practitioner. This case is a good example of how there can be several dimensions to an ethical dilemma, and the benefits of having a structured process in addressing such dilemmas. In Case Study 4, an accountant is advising a medium-sized group on a range of improvements to its operations and systems. After identifying a range of issues and preparing a report estimating the costs, the accountant becomes aware that the director with whom they are liaising has significantly understated these in a separate report to the board. The director does not share the accountant’s report with the board. This case requires consideration of to whom the accountant owes their fiduciary duty, and how they might discharge their duties and effectively manage their professional relationship with the client. Case Study 5 outlines a scenario in which a trainee accountant in a firm has been tasked with completing some complicated work within a very tight deadline in the lead-up to them taking study leave. While there are lessons to be learned for both parties, the case highlights that certain behaviour, which itself may be unethical, may give rise to further unethical behaviour directly impacting the quality of work for clients. In Case Study 6, a three-partner firm has a large audit client to whom it also provides non-audit services. There are substantial fees outstanding from the client and significant going-concern issues arise. Several issues are explored in this case, including that the audit planning section was not appropriately reviewed, that key information was missed, and that there is pressure to provide the bank with a clean audit opinion so it can extend the company’s overdraft facility. This is a situation in which more than one set of ethical obligations require consideration, in this case the Code of Ethics and the Ethical Standards for Auditors. Case Study 7 addresses suspected non-compliance with laws and regulations (NOCLAR), including bribery and cover-up of breaches of environmental laws and regulations, and considers any legal reporting obligations for the firm. The case highlights real issues that can arise, including dealing with pressure from clients to disregard any suspicions of noncompliance, desire to disassociate from illegal or unethical activity, deciding whether to override client confidentiality and report suspicions to the appropriate authorities, and balancing duties to the client with the public interest with safeguarding the reputation of the firm. CCAB’s Ethical Dilemma Case Studies provide an interesting and illuminating way to engage with the Code of Ethics while also increasing awareness of some threats to ethical conduct that can arise in an accountancy firm. Members are encouraged to use, read and apply them, and they can also be used by firms and/or training providers provided they are appropriately referenced. The case studies and other resources that can assist members in considering ethical dilemmas can be found on the Chartered Accountants Ireland Ethics Resource Centre. Níall Fitzgerald FCA Head of Ethics & Governance at Chartered Accountants Ireland

Apr 01, 2022
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