The fundamental aspect of the independence and integrity of an accountant

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The fundamental aspect of the independence and integrity of an accountant

The objectivity principle is aimed at making financial statements more relevant and reliable. The concept of relevance implies that financial statements can have predictive value and feedback value.

This means the financial statements are accurate and can be used to predict future company performance. The concept of reliability implies that financial information can be verified by many sources with evidence and that all financial information is presented.

In other words, the favorable and unfavorable financial information is presented in the financial statements. The two concepts of relevance and reliability encompass the objectivity principle. By making financial statements more relevant and reliable, the objectivity principle makes the financial information more usable for investors and creditors.

The objectivity principle extends to internal auditors and CPA firms as well. Although auditors must adhere to GAAS, auditors must be independent of the company they are auditing. This helps ensure that the financial reporting and audits are done objectively. If management or current shareholders wrote reports and audits, they would tend to be too optimistic and not rely on pure facts.

Most likely the bank will reject this financial statement because an independent party did not prepare it.

The fundamental aspect of the independence and integrity of an accountant

In other words, this income statement violates the objectivity principle. He leaves the company after he is offered a partnership position in DHI and Associates, an audit firm. After six months of working at the firm, he is assigned to the head auditor position on the Fisher Corp audit.

This is a violation of many GAAS rules, but it is also a violation of the objectivity principle. Big Ben says to go with the numbers in the accounting system.CODE OF ETHICS FOR Independence–Assurance Engagements .. ♦ The Code was issued in June and became effective on June 30, Paragraphs and are applicable to assurance engagements when the assurance report is dated on or Integrity A professional accountant should be straightforward and.

Roles and Importance of Professional Accountants in Business Professional Accountants in Business—A Varied Profession This article originally appeared in the China Accounting Journal, published by the Chinese Institute of CPAs. If the professional accountant uses specific information from client A's audit to prepare a business plan for client B, he will be violating the following fundamental principal: D. Confidentiality The recommendation of appointment and review of the external auditors by . Auditor independence is commonly referred to as the cornerstone of the auditing profession since it is the foundation of the public’s trust in the accounting profession. Since , a wave of high-profile accounting scandals have cast the profession into the limelight, negatively affecting the public perception of .

Auditor independence is commonly referred to as the cornerstone of the auditing profession since it is the foundation of the public’s trust in the accounting profession.

Since , a wave of high-profile accounting scandals have cast the profession into the limelight, negatively affecting the public perception of .

Auditor independence - Wikipedia

Integrity. Integrity is an important fundamental element of the accounting profession. Integrity requires accountants to be honest, candid and forthright with a client's financial information. Accountants should restrict themselves from personal gain or advantage using confidential information.

Note: The CIMA Code of Ethics is a Law of the Institute (to which all members and registered students are required to comply) for the purpose of the definition of “misconduct” in Byelaw 1.

*International Federation of Accountants. Auditor independence is commonly referred to as the cornerstone of the auditing profession since it is the foundation of the public’s trust in the accounting profession.

Since , a wave of high-profile accounting scandals have cast the profession into the limelight, negatively affecting the public perception of . Existing accountant A professional accountant in public practice or firm currently holding an audit appointment or carrying out accounting, taxation, consulting or similar professional services for a client.

The Value of Integrity