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Transparency International is committed to advancing accountability, integrity, and transparency. The mission is to stop corruption and promote transparency, accountability, and integrity at all levels and across all sectors of society, while the vision is a world in which government, politics, business, civil society, and the daily lives of people are free of corruption.
Required:
a. Discuss FIVE measures that are needed to ensure transparent, effective, and consistent application and enforcement of laws and regulations on anti-corruption. (10 Marks)
b. Explain TWO ways by which procurement officers can detect bid rigging. (5 Marks)
c. Explain FIVE powers of the Code of Conduct Bureau. (5 Marks)
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You are the Finance Director of a limited liability company. The company started trading with a handful of employees but now has a workforce of 200. You are aware that staff purchases of goods manufactured by the company are authorised by production managers and then processed outside the accounting system. The proceeds from these sales are used to fund the company’s annual Christmas party, organised for Directors of the company.
Required:
Discuss the possible actions that you will take in order not to breach the fundamental principles of the IFAC’s Code of Ethics. (10 marks)
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Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
a)
i) Explain how you could potentially act in order not to breach each of the FIVE (5) fundamental principles of the IFAC’s code of ethics. (5 marks)
ii) Recommend FIVE (5) possible actions that you should take as a member of the Institute of Chartered Accountants, Ghana in dealing with the situation. (5 marks)
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The IFAC Code of ethics governs the practice of auditing to ensure that practitioners will act in the public interest. Furthermore, in an audit, many relevant auditing standards must be followed to perform work that will serve the needs of the users of the Auditor’s report.
Required:
Explain each of the FIVE (5) fundamental principles of the Code of Ethics and conduct for professional audit practitioners. (5 marks)
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Amalgamating two or more firms into one presents ethical challenges.
Required:
Discuss TWO ethical considerations that the partners and their accountants should take into account in the process of the amalgamation of the partnerships.
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You are a newly qualified accountant in practice, and you lead a team providing management consultancy services. In recent years, your practice has undertaken several assignments on manufacturing efficiency improvements for medium-sized, listed groups of companies in Ghana. One of the Regional Directors has requested an urgent investigation into Project A due to delays and potential cost overruns. After some initial investigation, your team discovers significant issues that could cause a delay of at least three months and additional costs of GH¢7 million to GH¢10 million, not including possible compensation claims.
One week before the final report is due, the Finance Director of the group calls you and asks for an update on Project A’s status. He mentions that the Regional Director informed the Board that the additional costs would only be GH¢4 million to GH¢5 million, with a delay of about six to eight weeks. He asks for confirmation of this information before the upcoming Board meeting, where they will discuss remedial actions for the group’s cash flow.
Required:
i) Discuss the potential ethical issues involved in breaching the fundamental principles of IFAC’s Code of Ethics. (5 marks)
ii) Recommend the possible actions that you should take as a newly admitted member of the Institute of Chartered Accountants, Ghana, in dealing with this ethical dilemma. (5 marks)
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Fundamental principles require that a member of a professional accountancy body behave with integrity in all professional, business, and financial relationships and strive for objectivity in all professional and business judgments. Objectivity can only be assured if the member is and is seen to be independent. Conflicts of interest have an essential bearing on independence and the public’s perception of the accounting profession’s integrity, objectivity, and independence.
The following scenario is a press report on a multinational firm of accountants:
The regulatory body directed a partner in a firm that he must resign because he was in breach of the regulatory body’s independence rules. His brother-in-law was the Financial Controller of an audit client. He was informed that the alternative was for him to move his home and place of work at least 400 miles from the client’s office, even though he was not the reporting partner. This made his job untenable. The accounting firm saw the regulatory body as ‘taking its rules to absurd lengths’. Shortly after this comment, the multinational firm announced proposals to split the firm into the following areas: audit, tax and business advisory services; management consultancy; and investment advisory services.
Required:
In relation to integrity, objectivity and independence, discuss the impact the above events may have on the public perception of the multinational firm of accountants. (10 marks)
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Papa Nii and Papa Nana who just qualified as Professional Accountants have decided to enter into professional practice under a firm name Nana Nii & Associates. These two have been trainee accountants of an Audit and Assurance firm for three years before qualifying.
For their first engagement, the CEO of Mberdane Ltd. has nominated Nana Nii & Associates for appointment as auditors of his company though Mberdane Ltd was a former client of their former firm, Papa Nii and Papa Nana were never on the engagement team of Mberdane Ltd. As beginners, Papa Nii and Papa Nana have intended to follow best practices as required by ISQC 1 “Quality control for firms that perform audits and reviews of financial statements, and other assurance related services”. However, they are not clear on the matters that they have to consider in their acceptance decision according to the standard. They have approached you, a senior partner of their former firm, for advice.
Required:
Advise Papa Nii and Papa Nana on the matters that they may have to consider in relation to the acceptance decision on their nomination. (10 marks)
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a) Asumasi Opoku has recently been appointed as a partner of Offei-Ansah & Co, a firm of Chartered Accountants. He has been a close friend of the Engagement Partner (EP), the firm’s managing partner for many years. Asumasi was previously the training manager in the firm and he has now been asked to act as training partner. This is the first time Offei-Ansah & Co have designated a particular partner as having responsibility for training.
One of the audit trainees, Ellen Danso, noted that she was disturbed by something that had happened on an audit of a company called Bremang Ltd, a medium-sized family-run business and longstanding client of Offei-Ansah & Co.
Ellen was auditing purchases of non-current assets when she noticed a transaction that she thought might be suspicious. There was a charge of GH¢125,000 (an individually material amount) for a Power Plant for an address in a rural area (no electricity) with no obvious link to the company. When she asked Bremang’s financial controller about the matter, she was told it referred to the installation of such a plant in a house owned by the Chief Executive Officer (CEO). This was to facilitate excellent communications and interaction with the CEO especially during the last quarter of the year when he liked to reside there with his family. She further explained that part of the cost was attributed to having to pay for a personal broadband connection since the house was in an isolated area where normal broadband connections were unavailable.
The financial controller appeared surprised and even irritated by the queries about the matter and said that auditors had not previously been concerned about the company being charged for non-current assets and operational expenses at properties owned by the CEO.
The engagement partner on the assignment happened to be the managing partner. Ellen told him what she had found and the Engagement Partner simply said that the charge could probably be ignored. He did, however, say that he would include a reference to the matter in the written representations letter required by ISA 580: Written Representations adding with a smile that “paper never refused ink”. About two months later, Ellen looked at the completed files and the letter of representation in which there was no reference to the matter.
When Asumasi Opoku heard about Ellen’s concerns, he realised that there was an ethical issue. At the very least the transaction should have been disclosed as a related party transaction under IAS 24: Related Party Disclosures but the situation was made more complicated by the fact that the Engagement Partner was (for all practical purposes) still Asumasi’s boss in Offei-Ansah & Co.
Required:
i) Explain TWO (2) reasons why integrity in professional relationships such as those described in the above scenario is vital. (2 marks)
ii) Evaluate FOUR (4) ethical and professional behavior issues relating to the stance of the Engagement Partner. (8 marks)
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