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

FINANCIAL REPORTING AND ETHICSinformation disclosed by an employer or a potential client, or withinthe company or employing firm.A professional accountant has the responsibility of ensuring that hisstaff and individuals from whom counsel and assistance are obtainedrespect the professional accountant’s duty of confidentiality. The needto uphold the principle of confidentiality continues after the end of thebusiness or professional relationships between a client or employer andthe professional accountant.Circumstances under Which Professional Accountants May DiscloseConfidential InformationThe Code (2009) listed the circumstances under which professionalaccountants are or may be required to make disclosure of confidentialinformation, under Section 140.7 as follows:(a)(b)(c)The law permits disclosure when it is authorised by the client orthe employer;Disclosure is required by law. An example is the production ofdocuments, etc during court proceedings or making disclosureto the enquiring public offices of infringements of the law whichhave been discovered; andWhere there is a professional duty or right to disclose, when thelaw does not prohibit it. This arises in order to comply with thequality review of a professional body or respond to an inquiry orinvestigation by a member body or regulatory body. It could alsohave to do with the protection of the professional interests of aprofessional accountant in legal proceedings or compliance withtechnical standards and requirements of ethics.Relevant Factors to Consider In Deciding to Disclose ConfidentialInformationThe Code of Ethics (2009) puts forward the following factors, amongothers, for consideration:(a)Whether the parties’ interests, including those of third partiescould be prejudiced if the employer or client gives consent to theprofessional accountants’ disclosure of information;(b)Whether all the relevant information is known and substantiated,to such an extent that it is practicable; when the situation involvesunsubstantiated facts, incomplete information or unsubstantiatedconclusions, professional judgment shall be used to determinethe type of disclosure to be made, if there is any;174