ICAS response to IESBA strategy survey

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By James Barbour CA, Director, Policy Leadership

4 July 2017

James Barbour reports on the ICAS Ethics Board’s response to the IESBA strategy survey.

The ICAS Ethics Board has responded to the International Ethics Standards Board for Accountants (IESBA) survey on the key issues IESBA should address that might impact its Code of Ethics for Professional Accountants (the Code). The survey is a first step in the development of IESBA’s strategy and work plan beyond 2018. The survey is important as the ICAS Code of Ethics is substantively based on the IESBA Code.

ICAS has highlighted that the following topics, ranked in order of importance, are the areas which IESBA should prioritise.

Post-implementation Review of the Restructured Code

IESBA is currently in the final stages of a major project to restructure its Code of Ethics. The process should be completed by the end of 2017 and the restructured Code is intended to become applicable in 2019. The objective of this exercise is to improve the clarity and user friendliness of the Code.

ICAS highlighted in its recent response to the recent IESBA ‘Structure of the Code’ Phase 2 Exposure Draft


“We appreciate the work done by IESBA in relation to the re-structuring of the Code. However, the re-structuring process is complex and it is difficult to appropriately review the proposed changes. This may have led to matters being inadvertently missed. As such, it is suggested that IESBA devise a process so that if significant issues become apparent in the future they can be addressed quickly.”

Given the importance of this topic, ICAS believes that a post implementation review of the restructured Code is an essential feature of helping to ensure the success of this project and should be a key priority for IESBA.

Trends and Developments in Technology and Innovation

Given the speed of change in recent years, there is undoubtedly a need for IESBA to understand the transformative effects of trends and developments in technology and innovation on the assurance, accounting and finance functions, and explore their ethical implications. 

We also believe that both the International Auditing and Assurance Standards Board and International Accounting Education Standards Board should also have a strong interest in this subject matter, and therefore this is an area of work that would require appropriate co-ordination amongst the respective boards.

Emerging or Newer Models of Service Delivery

This is a topic closely related to that at 2 above and therefore is an area which IESBA should prioritise to ensure that the Code remains fit for purpose.

Meaning of Public Interest in the Global Context

ICAS highlighted in its recent response to the IESBA ‘Structure of the Code’ Phase 2 Exposure Draft


“In terms of clarity, it would be a good opportunity to clarify what the professional accountant’s responsibilities are in relation to the public interest. Some firms and others interpret the current text as if it is only the profession as a whole which has a specific responsibility to act in the public interest. However, the content of section 300.2 A6 of the proposed Code would imply that the responsibility to act in (and not just consider) applies to the individual professional accountant i.e. “Leadership of the firm that promotes compliance with the fundamental principles and establishes the expectation that professional accountants will act in the public interest.”

Therefore, as per our original observation, we believe this would be a good opportunity to clarify in the Code what the professional accountant’s responsibilities are in relation to the public interest.”

We therefore believe this is a project that should be prioritised by IESBA to seek to provide clarity and consistency to the public interest requirements within the Code.


ICAS believes that this is a topic that IESBA should prioritise. The IESBA Code currently only “encourages” professional accountants to document matters. We are not convinced that this is deemed to be sufficient by stakeholders. 

Behaviour is generally questioned some considerable time after the event and it can therefore be very difficult for individuals to recollect what exactly they did, or did not do, in a certain situation. Documentation can help explain how a decision was made at the time. 

Further, the actual process of writing something down can help with the formulation of a judgement. Whilst we appreciate that one must be careful not to overly burden the professional accountant with documentation, given the nature of today’s society we believe that this is an area worth exploring. 

We also note that various respondents to the Structure of the Code project highlighted specific matters in relation to documentation that need to be appropriately considered.

Breach of the Code/Definitions and Descriptions of Terms/Concepts of “Public Interest Entity” and “Listed Entity”

ICAS believes that a project to provide further guidance on what a professional accountant should do with respect to breaches of the Code should be prioritised. 

Additionally, for the purposes of improved consistent application of the Code, there is merit in a project considering the concepts of “Public Interest Entity” and “Listed Entity”. However, this could be considered as part of a wider project on definitions and descriptions of terms. Increased consistency of terminology would be beneficial to the accountancy profession and to stakeholders.

Other Matters – Moral Courage

ICAS also highlighted that IESBA should consider prioritising a project on enablers i.e. the underlying characteristics that enable professional accountants to comply with the fundamental principles.

ICAS highlighted that following consideration of the feedback received to its consultation paper on the fundamental principles, ICAS will introduce wording on ‘Moral Courage’ into its Code of Ethics (substantively based on the IESBA Code) later this year. This wording, in Section 100.5 of the ICAS Code of Ethics, will establish that “Moral Courage” is an enabler which helps CAs to comply with the fundamental principles.


  • Consultations and responses
  • Ethics and integrity research

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