Responsibilities of Professionals

 
 

"If [the free trip] is part of the work, then [the auditor] has to go on behalf of the client. But if it does not serve professional purpose, then perhaps it will be classified as gift and hospitality in which case [the auditor] should probably decline. There are guidelines under the code of ethics of the HKICPA which specify what cannot be accepted."

Mr Guy Look
Deputy Chairman, Professional Accountants in Business Committee,
Hong Kong Institute of Certified Public Accountants

 
Summary of views:
 

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Under the Prevention of Bribery Ordinance, it is an offence for any staff member to solicit or accept any advantages in connection with his work without his employer's approval. Professional bodies have internal guidelines specifying what can or cannot be accepted. It is increasingly important for listed companies to have their own code of ethics for their staff and directors.

 

 
 
 
 

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Regarding Ken's trip to the Thailand toy fair, it might be an offence if the trip was offered to Ken for asking him to compromise the quality of his auditing job. Nonetheless, some deliberated such trips might be acceptable if they served professional purposes, such as to inspect the business of their clients. The auditors would then need to declare such acceptance to their audit firms. Hence, professionals sometimes have to distinguish clearly whether the offer arises from professional relationship or friendship and should make sound judgement if the offer arises from the latter.
   
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As for the huge discount of vintage car to Ken's son, it might be a possible corruption offence if Ken had compromised his professional standard in the auditing job or it could lead to perceived conflict of interest.
   
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Ken indeed was doing several layers of business for Manfold other than his auditing work. Two factors for consideration were suggested from the professional firm's perspective: first whether the contracts were of conflicting nature, for example if non-assurance work was related to preparation of the information they had to audit later, and second relative size of the different contracts. In case the consultancy work was of higher value, it might affect the impartiality of the audit job.