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Questions and Answers
What must a professional accountant avoid to maintain the integrity of the profession?
Which behavior is considered a violation of professional conduct for an accountant?
How should a professional accountant approach advertising their services?
What action should an accountant take if unsure about the propriety of their advertisement?
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Which of the following actions would NOT be considered professional misconduct?
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What does the requirement for honesty in accounting entail?
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Which fundamental principle is essential for maintaining a good reputation in the accounting profession?
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What is the potential consequence of an accountant disparaging the work of others?
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What is a major ethical failing of the Chartered Accountant in this scenario?
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Why did the Chartered Accountant leave certain accounts out of his reporting?
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What does the term 'NPA' refer to in this context?
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What is expected from professionals in the field of Chartered Accountancy regarding ethical conduct?
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What behavior did the owners of the firms exhibit toward the Chartered Accountant?
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What is an intrinsic aspect of ethics as per the content?
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What happens to the accounts of the firms whose owners did not meet the Chartered Accountant?
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How should Chartered Accountants ideally act based on the principles of professional ethics?
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What is one potential issue a Chartered Accountant faces regarding professional conduct in auditing firms?
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Under the Chartered Accountants Act, what is essential for maintaining the integrity of a branch audit?
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Which type of misconduct is related to failing to follow established procedures and regulations?
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What does the term 'KYC norms' refer to in the context of accounting?
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What responsibility does a Chartered Accountant have when encountering discrepancies in audit reports?
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In what way can professional ethics guide Chartered Accountants in practice?
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What is a consequence of failing to accurately ascertain drawing power in audits?
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What should be the primary concern of a Chartered Accountant when potential errors are identified in financial statements?
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Study Notes
Professional Ethics and Responsibilities of Chartered Accountants
- Accounts of several firms are operating satisfactorily, but are reported as NPAs due to ongoing audit issues.
- AGM experiences regular distress over delayed audit completion and reporting by the Chartered Accountant (CA).
- Three out of seven firm owners meet the CA, promising future services, while others do not, leading to negative reporting.
- CA's conduct raises ethical concerns, prioritizing personal benefits over professional responsibilities.
Ethical Standards
- Chartered Accountants must act in public interest, reflecting integrity and objectivity in their practices.
- Ethics is intrinsic, requiring accountants to rise above personal gain and adhere to moral principles.
- Professionals should not engage in activities that compromise their reputation or the integrity of the profession.
Misconduct Guidelines
- Professional accountants must avoid exaggerated claims of qualifications and experience.
- Disparagement of peers or unsubstantiated comparisons to others' work is unethical.
- Advertising must align with the guidelines issued by the Institute, ensuring truthful and responsible communication.
Responsibility in Advertising
- Advertising content must be truthful and consistent with the ethical standards established by the Institute.
- Accountants are encouraged to consult the Ethical Standards Board when unsure about advertising appropriateness.
Overview of Codes and Regulations
- The Chartered Accountants Act, 1949 establishes the framework for professional behavior and misconduct categories.
- Membership guidelines dictate the expected conduct and responsibilities for accountants in practice and in service.
Case Context
- CA R, a prominent practitioner, conducts audits for a public sector bank with significant advances.
- Discrepancies in stock statements noticed during the audit could be overlooked but are raised by CA R, along with minor procedural irregularities discovered by staff.
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Description
Explore the various challenges faced during financial audits, specifically regarding Non-Performing Assets (NPAs) in firms. This quiz delves into the complexities of managing accounts and the communication hurdles that arise between branch management and auditors.