Ethics

What is the need of Ethical Behaviour?

 Decision-makers expect the financial statements to be true and fair and fairly
represent the underlying transactions, therefore base their decisions on the Financial
Statements produced. Any incorrect or unethical FS may result in an incorrect
decision of public at large.

 Stakeholders rely on the information reported by accountants to make informed

decisions about the entity at hand therefore, to maintain the faith of the public,
accountants must be highly ethical in their work.

Ethical Responsibilities of Accountants

1. Ensure fair presentation

2. Not to mislead the users
3. Not to harm the credibility of the profession
4. Comply with ACCA’s code of ethics and conduct
5. Avoid deliberate falsification
6. Judgements should be independent and not affected by the business pressures.
7. Ensure compliance of IFRS, framework and local law
8. Transparency, and full and accurate disclosure
9. Judge any unfair, inappropriate or unethical circumstances
10. No personal gain

How to write Ethical Responsibilities of Accountants

1. The purpose of financial statements is to present a fair representation of the company’s
position and if the financial statements are deliberately falsified, then this could be deemed
unethical.

2. Accountants have a social and ethical responsibility to issue financial statements which do
not mislead the public.

3. Any manipulation of the accounts will harm the credibility of the profession since the public
assume that professional accountants will act in an ethical capacity.

4. The directors should remember that professional ethics are an integral part of the
profession and that they must follow the ethical guidelines such as the ACCA’s Code of Ethics
and Conduct.
5. Deliberate falsification of the financial statements would contravene the guiding principles
of integrity, objectivity and professional behaviour

6. The judgements made by professional accountants should be independent and not affected
by business pressures.

7. Financial statements must comply with International Financial Reporting Standards (IFRS),
the Framework and local legislation

8. Transparency, and full and accurate disclosure is important if the financial statements are
not to be misleading.

9. Accountants should have the ability to conclude that a particular rule is inappropriate,
unfair, or possibly unethical in any given circumstance

10. Directors have a responsibility to act honestly and ethically and not be motivated by
personal interest and gain