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

CA Meera Iyer completed an engagement for Kaveri Textiles Ltd two years ago and no longer acts for it. A competitor, Sagar Fabrics, offers her a consultancy fee and asks her to share the pricing details she saw during that engagement, noting that Kaveri has since published its annual report with some of the figures. Under the ICAI Code of Ethics (13th edition), what is the correct position?

She must not use or disclose the information. The Code says confidentiality continues after the professional relationship ends, and it still applies even if the information has become publicly available, properly or improperly. Elapsed time, partial publication or the competitor's promise of secrecy does not create an exception.

  1. AShe may use the details because the engagement ended two years ago
  2. BShe may use the details only for the parts already published in the annual report
  3. CShe may use the details if Sagar Fabrics promises to keep them confidential
  4. DShe must not use or disclose the information, since the duty continues after the relationship ends and even if the information has become publicCorrect

Explanation

The Code bars use or disclosure of confidential information after the relationship has ended. It also bars use or disclosure where the duty of confidentiality applies even though the information has become publicly available. So neither the passage of time nor the partial publication releases her, and a promise from the third party is not a recognised exception.

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