Professional Ethics Flashcards Preview

AAT - Level 3 > Professional Ethics > Flashcards

Flashcards in Professional Ethics Deck (30)
Loading flashcards...
1
Q

According to the Institute of Business Ethics what 3 questions should be asked in order to make an ethical decision?

A

Transparency - do I mind others knowing

Effect - does it affect or hurt anyone

Fairness - would it be considered fair by those affected

2
Q

What are the 5 key principles of the Code of Ethics for professional accountants?

A

Integrity

Objectivity

Professional competence and due care

Confidentiality

Professional behaviour

3
Q

When should confidential information be disclosed?

A

When permitted by law or authorised by client/employer

When required by law

When required by professional duty, in the public interest and not prohibited by law

4
Q

What are the threats to compliance with fundamental principles?

A

The self interest threat

The self-review threat

The advocacy threat

The familiarity or trust threat

The intimidation threat

5
Q

How should one approach dealing with ethical conflicts?

A

Step 1: gather information

Step 2: Analysis

Step 3: Action

6
Q

What is the CPD cycle?

A

Assess - what skills do I have

Plan - where am I heading/what skills do I need

Action - carry out actions to gain the skills I need as per above

Evaluate - analyse whether job is done and skills attained yet

7
Q

What are the differences between structured and unstructured CPD?

A

Structured are specific to area or needs identified

Unstructured are general information obtaining that is non specific or tailored to an individual’s needs

8
Q

What are types of business risks?

A

Political risks

Economic risks

Social risks

Technological risks

Strategic risks

9
Q

What are the main types of operation risks to a business?

A

Reputation at risk

Litigation risk

Process risk

People risk

Systems risk

10
Q

Why are the 3 acknowledged phases to money laundering?

A

Placement - cash from crime placed in financial system

Layering - obscure transactions using trusts and different entities etc…

Integration - investing funds in legally such as assets and property

11
Q

Define objectivity?

A

Means that a member must not allow bias, conflict of interest or undue influence of others to override professional or business judgements

12
Q

Define professional competence?

A

Continuing duty of members to:

Maintain professional knowledge and skill at the level required to provide competent professional service based on current developments in practice, legislation and techniques

13
Q

Define due care?

A

Means a member must act diligently and in accordance with professional standards when providing professional services

14
Q

Define integrity?

A

Being straightforward and fair in all professional and business relationships

15
Q

Define confidentiality?

A

In accordance with the law, respect the confidentiality of information and not disclose unless required by law or professional duty

16
Q

Define professional behaviour?

A

Complying with relevant laws and regulations and avoid anything that discredits the profession

17
Q

When dealing with ethical conflicts and and analysing having gathered information should the member consider legal perspective first or ethical principles compromised?

A

Legal to determine if any laws have been broken then the ethical principles compromised

18
Q

What does the UK Anti-money laundering legislation (AMLL) consist of?

A

The Proceeds of Crime Act 2002 (POCA)

The Money Laundering Regulations 2007 (MLR)

The Terrorism Act 2000 (TA)

19
Q

What are the 3 offences of money laundering under POCA?

A

S327 - concealing, disguising, converting, transferring or removing criminal property

S328 - taking part in an arrangement to facilitate the acquisition, use or control of criminal property

S329 - acquiring, using or possessing criminal property

20
Q

What is the procedure required to report money laundering?

A

If an MLRO exists submit an internal report to him if it does not submit a report to NCA (National Crime Agency)

21
Q

What are the four offences under the Bribery Act 2010?

A
  1. Bribing a person to induce or reward them (active bribery)
  2. Requesting, accepting or receiving a bribe (passive bribery)
  3. Using a bribe to influence a foreign official to gain business advantage
  4. Failing to prevent bribery on behalf of a commercial organisation
22
Q

What is the penalty under the Bribery Act 2010?

A

Imprisonment for upto 10 years and an unlimited fine

23
Q

What are the 3 distinct offences of fraud in the Fraud Act 2006

A

Fraud by false representation (Section 2)

Fraud by failing to disclose information (Section 3)

Fraud by abuse of position
(Section 4)

24
Q

What are the three reserved areas of accountancy and finance?

A

Insolvency

Investment business

External audit

25
Q

Which professional body sets global ethical standards for accountants?

A

IASB - International Accounting Standards Board

26
Q

Which body is responsible for developing quality standards for all accountancy bodies?

A

IFAC - International Federation of Accountants

27
Q

Which Accountancy Bodies are members of the CCAB (Consultative Committee of Accountancy Bodies)?

A
CIPFA
ICAEW
ICAS
CAI
ACCA
28
Q

Which accountancy bodies are sponsors of the AAT?

A

CIPFA
ICAEW
ICAS
CIMA

29
Q

What are the main grounds for civil law cases?

A

Breach of contract

Breach of trust

Negligence

30
Q

What are the legal requirements and actions to be taken if a client refuses to disclose an error or emission from a tax return?

A

Advise the client/employer of the implications and to disclose

Allow reasonable time to correct the issue

Advise client or employer that you will be reporting To the MLRO or NCA