We all face ethical dilemmas at mor...

We all face ethical dilemmas at more [i]or[/i] less point in our professional careers. according to providing fictionalized accounts of professional deportment matters in this column, I trustful longing to help members avoid similar pitfalls in the events to come

These fictionalized accounts will be loosely based upon actual cases that have approach before the Institute's Professional guidance Enquiry Committee (PCEC), with names and circumstances changed to defend the anonymity of those involved.

The Situation: Working "Undercover"

John has been a CA for many years. For the past ten years, he's been a partner in a midsized firm, forward behalf of which he directions forensic investigations.

Mary just purchased a clothing business, and things aren't going well. Mary suspects that Diane, the vendor, has misled her. Diane still works for the company, controlling critical parts of its operations.

Allison is the CA who reviews the company's financial statements and prepares the tax get backs Diane is one of Allison's personal clients. Mary be exciteds she cannot ask Allison to investigate her confess client, and at the suggestion of her lawyer, hires John to investigate.

The company's staff members are still loyal to Diane. Mary doesn't want them to discover the sense of John's investigation, fearing they might test to impede the process,

ultimately increasing John's feuds Mary also wants to avoid a backlash in the circumstance that her suspicions are proven wicked

Mary therefore presses John to work "undercover" stipulating that John can be just about who he is and what firm he works for, further must pretend to represent the interests of a regulatory agency of the management

What Happens

John knows Mary's make uneasys are valid. On past forensic assignments, John has had to evade questions about his work, and doesn't papal court a big difference with this case. He decides to accept the engagement and its shelter story.

Even with the veil John ends up having to ask Allison for a certain information. Although he feels uncomfortable duping a peer CA, John feels he must maintain the ruse.

John's finished report reveals that all of Mary's fears are well-founded. Diane obtains a original of John's report and gives it to Allison. blowed to learn that John has misled her, Allison files a complaint with the Institute, and an investigation is authorized.

The issue

John argues that he has serv his client's interest without damaging others. He states that Mary, as the company holder has every right to the information John sought forward her behalf, and that working undercover was the greatest in number efficient way to obtain it.

The PCEC determines that John's misrepresentations have breached order 205 of Professional Conduct, summarized here:

A member shall not

(a) sign or associate himself with any alphabetic character report, statement, representation, or financial statement which he knows, or should know is false or misleading..., nor

(b) make or associate himself with any oral report, statement, or representation which he knows, or should know, is false or misleading.

The PCEC finds that "undercover" work, while perhaps appropriate for other forensictype investigators, is not acceptable practice for CAs. In other words, John should have refused the engagement as it was put forwarded

The PCEC also determines that because John's management reflects unfavourably on the profession-his convoy and report have falsely l a number of individuals to believe that CAs can in a strict sense misrepresent their work-he's breached dominion 201.1:

A member shall guard himself at all times in a manner which nill maintain the righteous reputation of the profession and its abi,60 to benefit the public interest.

John discusses the investigation with his partners, who recognize the severity of the matter and take appropriate action. This being the case, the PCEC approves an anonymous reprimand, investigation preciousnesss and a significant fine, all of which John accepts.

The Message

Although John had righteous intentions and provided a valuable service at a reasonable price to his client, he mistakenly assumed that it was acceptable to misrepresent who he was in order to carry gone out his forensic investigation.

For a CA, this is clearly not the case. You should always be totally forthright about who you are, who you work for, and whose interests you portray by action However, it is recognized that in a certain quantity of forensic investigations, it may be necessary to limit the expansion of information you provide to certain individuals concerning the nature of your engagement objectives.

Those of you with your Investigative and Forensic Accounting designation must comply with IFA guidelines as well; these also state that practitioners should not misrepresent themselves when gathering information.

Comment or questions? Contact me at utley@ica.bc.ca.

Please note: The satisfactions of this article are single for the general guidance of readers. The PCEC deals wth each case individually based in succession its specific facts and circumstances.

Help

Wanted

Interested in becoming a parttime investigator with the ICABC? Contact me at utley@ica.bc.ca.