What happens when CPAs fail to be ethical? What happens when they cross the line when it comes to Independence?
These are questions Malik Datardina, Auvenir’s GRC Strategist, had before he embarked on his journey through Disciplinary Notices. Rule 204, as noted in the CPA Code of Professional Conduct, requires CPAs to maintain Independence with their assurance clients.
To give some background, when CPAs break the rules, they can be disciplined for professional misconduct by the Discipline Committee.[1] The outcome of the case is published online and in the local paper where that CPA practices. For example, a CPA who practices in Toronto will have their name published in the Globe and Mail.
Malik was hoping to find a model, like the infamous Fraud Triangle[2], within these cases. However, what he found instead was that these infractions could be categorized into the following 3 groups:
- Mixture of Shortcomings: These were CPAs who broke a number of rules, including Independence. They formed the largest group at over 50%.
- Mountain of Misconduct: The next group was the mountain of misconduct. Like the first group, they had a number of infractions, but they crossed some significant red lines. For example, this group included a CPA who committed a million-dollar tax fraud.
- Lessons Learned: And then the last group was where the Rule 204 violation was either central to the issue or was the only rule that was broken and was prosecuted by the Professional Conduct Committee (PCC).
Where can you learn more about Malik’s journey through Rule 204?
Auvenir is happy to announce that this is available through CPA Ontario’s website getting you 3.5 CPD hours. The course offering is delivered as a video on demand course along with a white paper and a ‘cheat sheet’ that summarizes the key lessons. All you need to do is log in to the CPA Ontario Professional Development portal to sign up!
This course was built with the small-medium sized practitioner in mind:
“I thought this course would be highly valuable to small-medium sized practitioners. I am sure they have more pressing matters than just reading disciplinary notices. And so I hope they (and others) can benefit from understanding what happens from a practical perspective when it comes to Independence & Ethics.” Malik Datardina, CPA, CA
Fill out the form below to access your copy of 'Ethics, Independence & Reality: An Intro' today!
Have feedback on the course or whitepaper? Email info@auvenir.com
Also, Malik is looking where to take his Disciplinary Notice journey next – so let us know your thoughts!