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ACCA Strategic Professional · Strategic Business Reporting (International) · Professional and ethical behaviour in corporate reporting

A professional accountant in business concludes that no safeguards can reduce an identified threat to an acceptable level. What should the accountant do?

The accountant should decline or end the specific activity or relationship creating the threat. When no safeguards can bring a threat to an acceptable level, compliance with the fundamental principles requires removing the circumstances, so recording the threat or obtaining employer consent is not sufficient.

  1. AContinue with the activity but record the threat in the file
  2. BDecline or end the specific professional activity, or the relationship causing the threatCorrect
  3. CSeek to have the threat reclassified as a self-review threat
  4. DContinue if the employer agrees in writing to accept the risk

Explanation

If threats cannot be eliminated or reduced to an acceptable level, the accountant must eliminate the circumstances or decline or discontinue the activity. Documenting it or obtaining employer consent does not restore compliance with the fundamental principles.

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