The changes are intended to enhance the clarity of the Code by:
- making clear the specific requirements that are contained in the Code, and
- explaining the application of the Code's conceptual framework.
The proposed changes resulted from the IESBA's project to improve the drafting conventions of the Code. Comments are requested only on the proposed changes to the Code that are the result of its drafting conventions project, not on the Code itself.
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Types of changes to the IFAC Code of Ethics Proposed in the Exposure Draft:
- Revised wording to indicate clearly what are the requirements
- Guidance on when a temporary departure from a requirement in the Code is allowed, and how to do it
- Description of five categories of threats to compliance with the fundamental principles, and examples of situations in which those threats might be created
- Guidance on how to assess whether a threat to compliance with the fundamental principles is 'clearly insignificant', which is defined in the Code as 'a matter that is deemed to be both trivial and inconsequential'
- Clarification of the 'conceptual framework approach' to emphasise the need for a professional accountant to apply the framework in the Code to any situation that is not explicitly addressed in the Code
- Clarify that examples in the Code must be followed.
- Drafting changes consistent with the following principles:
- 'Consider' is used where the accountant is required to think about several matters
- 'Evaluate' is used when the accountant has to assess and weigh the significance of a matter
- 'Determine' is used when the accountant has to conclude and make a decision
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The IESBA proposes that the revised Code be effective on 15 December 2010, with earlier adoption encouraged. That date will be approximately 18 months after the planned issuance of the document (currently projected to be June 2009). Comments on the exposure draft are requested by 15 October 2008. The exposure draft may be downloaded at
www.ifac.org/EDs. Click for
Press Release (PDF 35k).
