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ACCA Applied Knowledge · Business and Technology · The role of regulatory and professional bodies in promoting ethical and professional standards in the accountancy profession

Which of the following best describes the difference between a professional body and a statutory regulator in relation to the accountancy profession?

A professional body's authority comes from its membership rules, which members agree to follow, while a statutory regulator's authority comes directly from legislation. The regulator can therefore often act more widely, including against non-members, whereas the professional body mainly disciplines and supports its own members.

  1. AA professional body's powers come from membership rules agreed by its members, whereas a statutory regulator's powers come from legislationCorrect
  2. BA professional body can only advise, whereas a statutory regulator can only set exam syllabuses
  3. CA professional body regulates companies, whereas a statutory regulator regulates individuals only
  4. DThere is no difference because both are created by the government

Explanation

Professional bodies are generally membership organisations whose authority over members comes from their charter, rules and the members' agreement to be bound. Statutory regulators derive powers from law and can often act on non-members too. The other statements invert or invent the roles.

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