ACA Professional Ethics (ICAEW Code)

Question 1

The five fundamental principles in the ICAEW Code of Ethics are integrity, objectivity, professional competence and due care, confidentiality, and:

Accepted Answer

Professional behaviour

Answer

The five fundamental principles are: integrity, objectivity, professional competence and due care, confidentiality, and professional behaviour. Independence is a concept linked to objectivity but is not itself a fundamental principle.

Question 2

The principle of confidentiality requires a professional accountant NOT to disclose client information EXCEPT when:

Accepted Answer

Disclosure is required by law, authorised by the client, or there is a professional duty or right to disclose

Answer

Confidentiality may be overridden when disclosure is legally required (e.g., money laundering), authorised by the client, or where there is a professional duty or right to disclose in the public interest.

Question 3

The self-interest threat to objectivity arises when:

Accepted Answer

The accountant has a financial interest in the client

Answer

A self-interest threat occurs when a financial or other interest in the client could inappropriately influence the accountant's behaviour or judgement — for example, holding shares in an audit client.

Question 4

Which of the following best describes an intimidation threat?

Accepted Answer

A client threatens litigation or other action to influence the accountant's opinion

Answer

Intimidation threats arise when an accountant is deterred from acting objectively by actual or perceived threats from a client or employer — for example, threats of litigation or dismissal.

Question 5

Under the ICAEW Code, when should an accountant refuse to follow management's instructions?

Accepted Answer

When following those instructions would result in a breach of fundamental principles

Answer

The ICAEW Code requires professional accountants to refuse instructions that would involve a breach of the fundamental ethical principles, such as producing misleading financial information.

ACA ICAEW Practice Test

ACA ICAEW Practice Test

ACA Professional Ethics (ICAEW Code)