Program Pembelajaran Etika IAI Part 3.1

Summary

This script explores the role of public practice accountants, emphasizing their responsibility to provide professional services such as auditing, tax consulting, and financial management to external clients. It highlights the importance of independence in their work, especially in assurance services like audits, to maintain objectivity and trust. The script also delves into the ethical challenges accountants face, including conflicts of interest, familiarity, and intimidation, and outlines strategies to mitigate these threats through safeguards and independent reviews. Overall, it provides a comprehensive look at the ethical framework and challenges that define the profession.

Takeaways

• 😀 Accountants in public practice provide professional services to external clients, such as auditing, tax consulting, and financial management.
• 😀 Public practice accountants differ from business accountants, who work internally within companies and serve only internal stakeholders.
• 😀 Examples of public practice accountants include Mr. Ardi (bookkeeping and financial reporting), Mrs. Zakia (auditing financial statements), and Mr. Bagus (tax consulting).
• 😀 Assurance services provide confidence to users of financial reports (e.g., audits), while non-assurance services (e.g., bookkeeping) do not provide such guarantees.
• 😀 Independence is crucial for accountants in public practice, especially when conducting assurance services like audits, to maintain objectivity and integrity.
• 😀 Threats to an accountant's independence include self-interest, self-review, advocacy, familiarity, and intimidation, which could compromise objectivity.
• 😀 The ethical framework for accountants involves identifying threats to independence, evaluating their severity, and implementing safeguards to mitigate them.
• 😀 Safeguards to mitigate independence threats include assigning qualified personnel, using independent reviewers, and ensuring adherence to professional ethical standards.
• 😀 Ethical challenges faced by public practice accountants include conflicts of interest, providing second opinions, handling bribes, managing client asset custody, and dealing with non-compliance with laws.
• 😀 Accountants in public practice must apply the conceptual framework of ethical decision-making, which includes identifying and addressing ethical threats at all stages of service provision.
• 😀 The relationship between accountants and their clients should be managed with care to avoid conflicts of interest and preserve the integrity of professional services.

Q & A

What is the primary role of a public accountant?

A public accountant provides professional accounting services, such as auditing, tax consulting, and financial management, to external clients.

What are the key differences between accountants working in businesses and public accountants?

Accountants working in businesses provide services to the internal management of the company, while public accountants offer their services to external clients, such as auditing and tax consulting.

What does 'professional services' mean in the context of a public accountant?

Professional services refer to activities requiring specialized knowledge and skills, such as accounting, auditing, taxation, and financial consulting, provided by accountants to clients.

Can you provide examples of public accountants and their roles?

Examples include Mr. Ardi, who helps clients with financial reporting; Mrs. Zakia, who audits financial statements; and Mr. Bagus, who assists clients with tax compliance and consulting.

What is the difference between assurance and non-assurance services in accounting?

Assurance services provide confidence to users about the accuracy and fairness of financial statements, such as audits and reviews, while non-assurance services, like compilations, do not offer the same level of confidence.

Why is independence crucial for accountants performing assurance services?

Independence is essential to ensure that accountants provide objective, unbiased opinions in their work, particularly in audits and reviews, without any influence from the client or personal interests.

What are some common threats to an accountant's independence?

Common threats include self-interest (financial stake in the client), self-review (reviewing their own work), advocacy (promoting client interests), familiarity (close relationships), and intimidation (external pressure to act unethically).

What is the conceptual framework for addressing ethical issues in public accounting?

The framework involves three steps: identifying threats to independence, evaluating the significance of these threats, and mitigating them through safeguards like independent reviews or changes in the assignment.

What role does independence play in an audit engagement?

Independence is critical in audit engagements as it ensures the accountant’s objectivity and impartiality in forming an opinion on the fairness of the financial statements.

How can accountants mitigate the threats to their independence?

Accountants can mitigate threats by applying safeguards such as assigning qualified personnel, conducting independent reviews, and ensuring that team members are free from conflicts of interest.