Page 32 - Pakistan-Accountant-April-Jun 2018

Signature Qualification CA that Empowers to Lead PAKISTAN Cover Story Ethical Practice Ensures Public Confidence by Hamza Bilal rofessional accountants are expected to act in the wider interest of the public while working both in the role of an auditor or an employee of an organisation. Hence, Pwe as chartered accountants are not only expected to be technically strong and competent but at the same time, it is an expectation from us to reinforce ethical behaviour and ethical decision making by our clients and employers. Ethical practice ensures to sustain confidence of public in accountancy profession. In order to sustain confidence of stakeholders and avoid any disrepute to our profession, we are expected to be fully in compliance with relevant laws and regulations and disassociate ourselves in scenario where there is a known or suspected non-compliance by our employer or client and evaluate whether disclosure of the matter to relevant regulatory authority is required under vast public interest. Our Institute, The Institute of Chartered Accountants of Pakistan (ICAP), is a member of International Federation of Accountants (IFAC) and adopts the comprehensive Code of Ethics issued by International Ethics Standard Board for Accountants (IESBA), an independent standard setting body under the auspices of IFAC. ICAP has adopted conceptual principal- based approach which provides guidelines to professional accountants to help them identify threats to ethical behaviour, evaluate them and respond to them in desired manner by application of adequate safeguards to ensure confidence of a knowledgeable independent party in independence of professional accountant involved in the matter. Accountants are expected to observe principles of integrity, professional behaviour and confidentiality while providing services. Non-Compliance with Laws and Regulations (NOCLAR) is any act of omission or commission whether intentional or unintentional by an employer or a client, by those charged in governance or by management or by employees for or under the direction or willingness of the employer or client which is not in line with prevailing relevant laws and regulations. NOCLAR was initiated by IESBA to address NOCLAR became effective in July 2017. NOCLAR framework sets concerns of regulatory authorities and other stakeholders that out following steps to be taken by a professional accountant or ethical principle of confidentiality is acting as a potential barrier an auditor: to disclosure of NOCLAR where it might in fact be required to be disclosed in vast interest of public. NOCLAR sets out criteria to i. Identifying and understanding the facts involved in the evaluate where a disclosure to an external appropriate authority matter. might be required in public interest. The code acknowledges ii. Discuss the matter with management and those charged with that it can be a difficult scenario for a professional accountant governance. to decide appropriate course of action, hence it states that iii. Determine further action which might include seeking legal advice. professional accountants should often consider taking legal iv. Evaluating wether disclosure to an outside authority is advice in scenarios where there is known or suspected NOCLAR. required. 30 The Pakistan Accountant April - June 2018