ETHICAL PRINCIPALS

The five fundamental principles of ethics are usually considered to be: integrity, objectivity, professional competence and due care, confidentiality, and professional behavior.

Integrity:

Integrity is the quality of being honest and having strong moral principles; moral uprightness. It is generally a personal choice to hold oneself to consistent moral and ethical standards. In ethics, integrity is regarded by many people as the honesty and truthfulness or accuracy of one's actions.

Objectivity:

Generally, objectivity means the state or quality of being true even outside of a subject's individual biases, interpretations, feelings, and imaginings.

Professional competence and due care:

The principle of professional competence and due care imposes the following obligations on all professional accountants:
- To maintain professional knowledge and skill at the level required to ensure that clients or employers receive competent professional service.

Confidentiality:

(a) Self-interest threat the threat that a financial or other interest will inappropriately influence the professional accountant's judgment or behavior;
(b) Self-review threat the threat that a professional accountant will not appropriately evaluate the results of a previous judgment made or activity or service performed by the professional accountant, or by another individual within the professional accountant's firm or employing organization, on which the accountant will rely when forming a judgment as part of performing a current activity or providing a current service;
(c) Advocacy threat - the threat that a professional accountant will promote a client's or employer's position to the point that the professional accountant's objectivity is compromised;
(d) Familiarity threat - the threat that due to a long or close relationship with a client or employer, a professional accountant will be too sympathetic to their interests or too accepting of their work; and
(e) Intimidation threat - the threat that a professional accountant will be deterred from acting objectively because of actual or perceived pressures, including attempts to exercise undue influence over the professional accountant.
Safeguards
Safeguards are actions or other measures that may eliminate threats or reduce them to an acceptable level. Safeguards created by the profession, legislation or regulation include Educational, training, and experience requirements for entry into the profession.
- To act diligently in accordance with applicable technical and professional standards when providing professional services.
Confidentiality is the protection of personal information. Confidentiality means keeping a client's information between you and the client, and not telling others including co-workers, friends, family, etc. Examples of maintaining confidentiality include individual files being locked and secured.

Professional behavior:

A professional accountant should comply with relevant laws and regulations and should avoid any action that discredits the profession.
Threats
Threats may be created by a broad range of relationships and circumstances. When a relationship or circumstance creates a threat, such a threat could compromise or could be perceived to compromise, a professional accountant's compliance with the fundamental principles. A circumstance or relationship may create more than one threat, and a threat may affect compliance with more than one fundamental principle. Threats fall into one or more of the following categories:
• Continuing professional development requirements. Corporate governance regulations.
• Professional or regulatory monitoring and disciplinary procedures.
• External review by a legally empowered third party of the reports, returns, communications or information produced by a professional accountant.