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

Kiran, a finance manager at Dalton Group, discovers that the CFO has overstated revenue by recognising sales before control passed to customers, contrary to IFRS 15. Kiran raised the matter with the CFO and then the audit committee chair, but nothing was done. Which action is MOST consistent with the ACCA Code of Ethics and professional guidance on whistleblowing?

Kiran should take legal advice, document what he has done, and, where law permits or the public interest demands, report to an appropriate external authority. Confidentiality is not absolute, but disclosure must be made through proper channels, not public media, and destroying records is never acceptable.

  1. ATake no further action because confidentiality always overrides any disclosure
  2. BPost details on social media to pressure the board
  3. CConsider obtaining legal advice and, where permitted by law or the public interest, disclose to an appropriate external authority, documenting all stepsCorrect
  4. DDelete the relevant sales records to remove the problem

Explanation

Once internal channels are exhausted, the accountant may need to consider disclosing to an appropriate regulator or authority where law allows or the public interest requires, after taking legal advice and documenting actions. Confidentiality is not absolute. Social media disclosure is inappropriate, and deleting records would be a serious breach.

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