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CA Final · Financial Reporting · Professional and Ethical Duty of a Chartered Accountant

CA Kavita Rao heads a firm and is placing an advertisement about her firm's services. She is unsure whether the proposed advertisement is appropriate. Her office manager says the Institute will vouch for the claims if the ad follows the guidelines. Under the ICAI Code of Ethics (13th edition), which course is correct?

She should ensure the advertisement is true to the best of her knowledge and belief and conforms to the Advertisement Guidelines, accepting that the Institute owns no responsibility for its claims. If unsure, she is encouraged to consult the Ethical Standards Board of ICAI, which does not shift responsibility.

  1. AEnsure the contents are true to the best of her knowledge and belief and conform to the Advertisement Guidelines, knowing the Institute owns no responsibility for the contents or claims, and she may consult the Ethical Standards Board of ICAI if in doubtCorrect
  2. BRely on the Institute to accept responsibility for the claims since the guidelines were followed
  3. CPublish the ad, as truthfulness is needed only if a client complains
  4. DConsult the Ethical Standards Board, which then becomes responsible for the claims

Explanation

The Code requires that the contents of an advertisement be true to the best of the accountant's knowledge and belief and conform to the Advertisement Guidelines. The accountant must be aware that the Institute does not own any responsibility for the contents or claims. If in doubt, she is encouraged to consult the Ethical Standards Board of ICAI, but this does not transfer responsibility.

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