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ACCA Strategic Professional · Advanced Audit and Assurance (International) · Code of Ethics for Professional Accountants

Vantage LLP's audit client, Quill Ltd, refuses to allow disclosure of a suspected fraud by its chief accountant to a regulator. Vantage's partner believes the matter creates a legal reporting duty under local law. Which approach best reflects the Code's position on confidentiality?

Confidentiality is not absolute. Where law requires or permits disclosure, or a professional duty or public interest justifies it, the partner may disclose to the appropriate authority. The partner should take legal advice and weigh the interests involved, rather than stay silent regardless or go to the press.

  1. AConfidentiality is absolute and the partner must stay silent whatever local law requires
  2. BDisclosure is permitted or required where law demands it, and the partner should consider legal advice and the public interest before decidingCorrect
  3. CThe partner should inform the press to protect the public
  4. DThe partner may disclose only if Quill's board later consents

Explanation

The duty of confidentiality does not apply where there is a legal duty or right to disclose, and the Code allows disclosure in the public interest or in professional proceedings. The partner should consider the relevant law, take legal advice and weigh the interests of stakeholders. Informing the press is an inappropriate route.

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