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Find Related Questions by Tags, levels, etc.
Rules-based code of ethics contains specific rules about how accountants should act in specific situations. Principles-based code of ethics specifies general principles of ethical behaviour and requires professional accountants to act in accordance with the principles. Both are issued by professional accountancy bodies to regulate the conduct of accountants in the course of performing their duties. All accountants who are members of a professional body, such as the Institute of Chartered Accountants of Nigeria, are required to comply with the regulations of that professional body which apply to both external and internal auditors. The reason for the wide reach of ethical guidelines is that the accountancy profession accepts that its members have a responsibility to act in the public interest while discharging their duties.
You are required to:
a. State THREE of the weaknesses of rules-based code of ethics. (3 Marks)
b. Identify FIVE key fundamental principles in the principles-based code. (5 Marks)
c. Explain the phrase “Duty of skill and care.” (2 Marks)
d. When are accountants said to be “acting in the public interest”? (5 Marks)
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Negligence is a tort that professional accountants must guard against in their relationship with their clients.
Required:
Define negligence and state the THREE elements that a litigant must prove to succeed in an action for negligence.
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Find Related Questions by Tags, levels, etc.
Capare Industries Ltd, which already held shares in a company known as Logotex Co., later made a takeover bid on the strength of its accounts prepared by Dickman Ltd., a firm of auditors. Capare Industries Ltd realized that the accounts were inaccurate in that they showed a pre-tax profit of GH¢1.3 million when in actual fact there had been a loss of GH¢400,000. It was the case of Capare Industries Ltd that if they had known the true situation, they would not have made a bid at the price they did or may not have made a bid at all. They argued that they were owed a duty of care by the auditors as new investors and as existing shareholders who in reliance on the accounts had bought more shares.
Required:
Explain whether Capare Ltd would be justified in taking action against the firm of auditors.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Rules-based code of ethics contains specific rules about how accountants should act in specific situations. Principles-based code of ethics specifies general principles of ethical behaviour and requires professional accountants to act in accordance with the principles. Both are issued by professional accountancy bodies to regulate the conduct of accountants in the course of performing their duties. All accountants who are members of a professional body, such as the Institute of Chartered Accountants of Nigeria, are required to comply with the regulations of that professional body which apply to both external and internal auditors. The reason for the wide reach of ethical guidelines is that the accountancy profession accepts that its members have a responsibility to act in the public interest while discharging their duties.
You are required to:
a. State THREE of the weaknesses of rules-based code of ethics. (3 Marks)
b. Identify FIVE key fundamental principles in the principles-based code. (5 Marks)
c. Explain the phrase “Duty of skill and care.” (2 Marks)
d. When are accountants said to be “acting in the public interest”? (5 Marks)
Find Related Questions by Tags, levels, etc.
Negligence is a tort that professional accountants must guard against in their relationship with their clients.
Required:
Define negligence and state the THREE elements that a litigant must prove to succeed in an action for negligence.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Capare Industries Ltd, which already held shares in a company known as Logotex Co., later made a takeover bid on the strength of its accounts prepared by Dickman Ltd., a firm of auditors. Capare Industries Ltd realized that the accounts were inaccurate in that they showed a pre-tax profit of GH¢1.3 million when in actual fact there had been a loss of GH¢400,000. It was the case of Capare Industries Ltd that if they had known the true situation, they would not have made a bid at the price they did or may not have made a bid at all. They argued that they were owed a duty of care by the auditors as new investors and as existing shareholders who in reliance on the accounts had bought more shares.
Required:
Explain whether Capare Ltd would be justified in taking action against the firm of auditors.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
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