Financial Reporting and Ethics - The Institute of Chartered ...

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FINANCIAL REPORTING AND ETHICSA professional accountant should exhibit independence of mind andappearance. The former attribute indicates the freedom of mind in theexpression of a conclusion, without being affected by influences whichcompromise professional stand point, thereby assisting an individual toperform with integrity and uphold objectivity and professional skepticism,“Independence in appearance” addresses the avoidance of circumstances andfacts which are so significant that a well informed and reasonable thirty partywould likely conclude, having regard to the logic and reality of the situation,that a firm’s, or a member of the audit team’s integrity, objectivity orprofessional skepticism has been compromised.The consequences of failure to recognize the privacy of serving public interestsby professional accountants are severe. The credibility and existence of theprofession are threatened by the complicity of accountants in the collapse ofcorporate governance and accounts manipulation, such as have been recordedagainst Arthur Andersen in the scandal and censorship of Enron Corporationin the United States of America.7.5 THE LEGAL FRAMEWORK FOR BUSINESSES AND ACCOUNTANTSANTSThe legal Framework for businesses and accountants is rooted in the Companiesand Allied Matters Act, Cap. C20, Laws of the Federation of Nigeria 2004, andmay be briefly discussed, as follows:7.5.1 Incorporation of CompaniesProvisions of the Act state, as follows:(a)(b)(c)Any two (2) or more persons may form and incorporate a company;Any company, association, or partnership consisting of more thantwenty (20) persons shall be registered as a company under theAct;Provision above does not apply to:(i) A cooperative society; and(ii) A partnership for legal practice and chartered accountancy.If the number of members exceeds twenty (20) and they carryon business for more than fourteen (14) days, every person shallbe liable to a fine of N25for every day of default.(d)An individual shall not join in the formation of a company if heis:(i) Less than 18years of age (unless two other persons whoare 18years and above have subscribed to the memorandum);(ii) Of unsound mind by a court;(iii) An undischarged bankrupt;(iv) Disqualified from being a director of a company.152
THE ENVIRONMENT: CORPORATE, PROFESSIONAL AND REGULATORY(e)A corporate body in liquidation shall join in the formation of acompany.7.5.2 Types of CompaniesThe types of companies in existence are:(a)(b)(c)(d)(e)A company limited by shares: Members’ liability is limited tothe amount unpaid on the shares held by him/her;A company limited by guarantee: This is the amount undertakenby a member to contribute in the event of winding up company;An unlimited company is one which does not have any limit onthe liability of its members;A private company limited by share has the word ‘limited’ or‘Ltd’ at the end of its name;A public company limited by share has the description ‘publiclimited company’ or ‘PLC’ after its name.Private CompanyA private company has the following descriptions:(a) Stated in its memorandum to be a private company;(b) Restricts the transfer of its shares;(c) The total number of members shall not exceed fifty (50);(d) It shall not invite members of the public to subscribe for anyshares or debentures or deposit money for fixed period or payableat call.Public CompanyPublic company shall state in its memorandum of association that it isa public company.Unlimited CompanyAn Unlimited Company shall be registered with a share capital.Company Limited by GuaranteeA Company limited by guarantee has the following features:(a)(b)(c)It is formed for promoting commerce, art, science, religion, sports,culture, education, research and charity;It shall not be registered with a share capital; andTotal liability of members in the event of its being wound upshall not be less than N10,000153
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FINANCIAL REPORTING AND ETHICS1.3.3
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ACCOUNTING AND REPORTING POLICIESsu
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ACCOUNTING AND REPORTING POLICIES(j
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ACCOUNTING AND REPORTING POLICIES(i
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ACCOUNTING AND REPORTING POLICIES2.
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3AMALGAMATION, ABSORPTION ANDRECONS
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AMALGAMATION, ABSORPTION AND RECONS
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4ANALYSIS AND INTERPRETATION TION O
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ANALYSIS AND INTERPRETATION OF FINA
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5ACCOUNTING STANDARDS5.0 LEARNING O
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ACCOUNTING STANDARDS(i)(ii)(iii)(iv
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ACCOUNTING STANDARDSThere is no SAS
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ACCOUNTING STANDARDS5.2.4 Borrowing
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ACCOUNTING STANDARDS(iii)Certain pe
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ACCOUNTING STANDARDSby venture capi
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Page 113 and 114: 6ETHICAL FRAMEWORK, CONCEPTSAND VAL
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Page 147 and 148: 7THE ENVIRONMENT: CORPORATE,PROFESS
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Page 177 and 178: PROFESSIONAL ETHICSabout conflicts
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Page 181 and 182: PROFESSIONAL ETHICSA. III onlyB. II
Page 183 and 184: 9DECISION MAKING IN ETHICS9. 0 LEAR
Page 185 and 186: DECISION MAKING IN ETHICS9.2 A FRAM
Page 187 and 188: ETHICAL THREATS AND SAFEGUARDS(d)We
Page 189 and 190: DECISION MAKING IN ETHICS4. A perso
Page 191 and 192: 10ETHICAL THREATS TS AND SAFEGUARDS
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Page 201 and 202: ETHICAL THREATS AND SAFEGUARDSimmin
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ETHICAL THREATS AND SAFEGUARDSHowev
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ETHICAL THREATS AND SAFEGUARDS(iii)
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11CORPORATE GOVERNANCE11.0 LEARNING
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CORPORATE GOVERNANCE11.3.1 Nature(a
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CORPORATE GOVERNANCEThe company sho
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CORPORATE GOVERNANCEtrust, possible
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CORPORATE GOVERNANCEAn agent has im
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CORPORATE GOVERNANCE(a)(b)(c)(d)(e)
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CORPORATE GOVERNANCE11.6.1 The law
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CORPORATE GOVERNANCEILLUSTRAUSTRATI
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CORPORATE GOVERNANCEimitated. They
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CORPORATE GOVERNANCE(a)(b)Greenbury
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CORPORATE GOVERNANCE11.9.2 Boards d
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CORPORATE GOVERNANCErelationship wi
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CORPORATE GOVERNANCE(e)(f)(g)(h)(i)
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CORPORATE GOVERNANCE(vi)Inquisitive
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CORPORATE GOVERNANCE(e)ConsultancyA
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CORPORATE GOVERNANCEThe incoming au
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CORPORATE GOVERNANCEIn summary, acc
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CORPORATE GOVERNANCEAccording to Th
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CORPORATE GOVERNANCE3. A body corpo
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12SOCIAL AND ENVIRONMENTALISSUES IN
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SOCIAL AND ENVIRONMENTAL ISSUES IN
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APPENDIX ISUGGESTED SOLUTIONS TO RE
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SUGGESTED SOLUTIONS TO REVISION QUE
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SUGGESTED SOLUTIONS TO REVISION QUE
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APPENDIX IICOMPREHENSIVE QUESTIONS
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COMPREHENSIVE QUESTIONS AND SUGGEST
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APPENDIX IIICASE STUDY 1Karsashi, a
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CASE STUDIES(iii)(iv)The floor sale
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CASE STUDIESShare price and dividen
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CASE STUDIESSUGGESTED SOLUTION(A) A
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CASE STUDY 3The following informati
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CASE STUDIESCASE STUDY 4Ologobojo i
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APPENDIX IVTable 1:SUMMARY OF INTER
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SUMMARY OF INTERNATIONAL ACCOUNTING
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APPENDIX VGLOSSARY OF TERMSAbsorpti
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GLOSSARY OF TERMSEthical Objectivis
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APPENDIX VIBIBLIOGRAPHYChambers Ham
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APPENDIX VIISTUDY AND EXAMINATION T
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STUDY AND EXAMINATION TECHNIQUES7.3
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INDEXAAbsorption, 17, 19, 39, 40, 4
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INDEXProfessional Behaviour, 136, 1
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