IESBA revises ethics code

  • IESBA (International Ethics Standards Board for Accountants) (lt gray) Image

24 Sep 2013

The International Ethics Standards Board for Accountants (IESBA) has amended its 'Code of Ethics for Professional Accountants' (Code) to change to the definition of “those charged with governance” to more closely align it with the definition used in International Standards on Auditing (ISAs).

Originally exposed for comment in July 2012, the intent of the IESBA's conforming change is to eliminate potential confusion between the Code and ISA 260, Communication with Those Charged with Governance. The IESBA does not anticipate any changes will be necessary to accounting firms’ systems and methodologies or common practice as a result of this revision.

The changes clarify that a subgroup of those charged with governance of an entity, such as an audit committee, may assist the governing body in meeting its responsibilities. In those cases, if a professional accountant or firm communicates with such a subgroup, the Code requires the professional accountant or firm to determine whether communication with all of those charged with governance is also necessary so that they are adequately informed.

The changes are effective on 1 July 2014 and will be reflected in the 2014 Handbook of the Code of Ethics for Professional Accountants. The 2013 Handbook is currently available to download or purchase on the IFAC website.

See the IESBA press release and Basis for Conclusions for more information (links to IFAC website).

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