Martin, Mica Lizette D.

BS ACCT IV

MAS PRACTICE STANDARDS AND ETHICAL CONSIDERATIONS

MAS Practice Standards

Personal Characteristics
A practitioner must act with integrity and objectivity and be independent in mental attitude.
Integrity ensures that statements of findings and recommendations are free of intentional
distortions or misstatements
Objectivity is the ability to avoid bias and to maintain an impartial attitude on all matters
under review.
Independent mental attitude is based on the practitioner’s obligation to the client and on
the need to avoid impairment of public confidence in the profession. He must avoid assuming the
role of management, limiting his services to those of an objective researcher, analyst, or advisor,
rather than a decision maker.

Competence
A practitioner should have competence in the analytical approach and process, and in the
technical subject matter under consideration.
Competence involves the technical qualifications and ability to supervise the personnel
assigned, to evaluate the quality of work performed, and to accept responsibility to the client for
successful completion of the engagement. It is the ability to identify and define client needs, to
utilize the analytical approach and process, to apply knowledge of the technical subject matter
under consideration, to communicate recommendations effectively, and to assist in implementing
the recommendations. It is acquired and maintained through a combination of education and
experience. Competence may be augmented by research and by consultation with others.

Due Care
Due care is concerned with what the practitioner does and how he does it. It involves
diligence and appropriate attention in carrying out the assignment. It does require systematic
critical review by the practitioner, throughout the engagement of work accomplished and
judgement exercised. Due professional care requires that all work be done within the provisions
of the Code of Professional Ethics and other Professional Standards for CPAs.

Client Benefit
Before accepting an engagement, a practitioner is to notify the client of any reservations
he has regarding anticipated benefits.

Understanding with Client

Before undertaking an engagement, a practitioner is to inform his client of all significant
matters related to the engagement.
The significant matter related to an engagement generally include the engagement’s
objectives, scope, approach, role of all personnel, manner in which results are to be communicated,
timetable and the fee.
Planning, Supervision, and Control
Planning is the translation of engagement objectives into a structured set of activities and
events within a targeted time schedule.
The practitioner in charge must exercise judgement as to the appropriate amount of
supervision, based on the experience of the persons involved and the complexity of the
engagement.
Effective control requires measurement of progress in meeting the engagement plan and
objectives

Sufficient Relevant Data

Sufficient relevant data is to be obtained, documented and evaluated in developing
conclusions and recommendations.
It should record, as appropriate the evidential matter obtained and its source, the
alternatives considered and the analytical process leading to specific recommendations.

Communication of Results
All significant matters relating to the result of the engagement are to be communicated to
the client. The principal findings, recommendations, and accomplishments, and the major
assumptions relied upon, should be conveyed to the client, together with any limitations,
reservations, or other qualifications.
Reports to the clients may be written or oral. When a practitioner does not issue a written
report to the client, he should prepare a file memorandum documenting the significant
recommendations and other pertinent information discussed with the client.

Ethical Considerations
Code of ethics for Professional Accountants in the Philippines Relevant to Management
Consultancy Services
Professional accountants as defined in the Code of Ethics are those persons who hold valid
certificate issued by the Board of Accountancy, whether they be in public practice, industry,
commerce, the public sector or education.

Part A
Section 100.1 of the Revised Code provides for the following:
“A distinguishing mark of the accountancy profession is its acceptance of the responsibility
to act in the public interest. Therefore, a professional accountant’s responsibility is not exclusively
to satisfy the needs of an individual client or employer. In acting in the public interest a
professional accountant should observe and comply with the ethical requirements of this Code.”

Section 100.4 describes the Fundamental Principles that every professional accountant, whether
he/she be in public practice, private industry, academe or government services must observe:

Integrity
All professional accountants should be straightforward and honest in professional and
business relationships. Integrity also implies fair dealing and truthfulness.
A professional accountant should not be associated with reports, returns, communications
or other information where they believe that the information contains a materially false or
misleading statement contains statements or information furnished recklessly or omits or obscures
information required to be included where such omission or obscurity would be misleading
A professional accountant will not be considered to be in breach of paragraph 110.2 if he
provides a modified report.

Objectivity
A professional accountant should not allow bias, conflict of interest or undue influence of
others to override professional or business judgements. He should not compromise their
professional or business judgement because of bias, conflict of interest or the undue influence of
others.

Professional Competence and Due Care

A professional accountant has a continuing duty to maintain professional knowledge and
skill and act diligently and in accordance with applicable technical and professional standards. He
should attain and maintain his professional competence.

Confidentiality
A professional accountant should not disclose any such information to third parties without
proper and specific authority unless there is a legal or professional right or duty to disclose

Professional Behavior
A professional accountant should comply with relevant flaws and regulations and should
avoid any action that discredits the profession. He should not bring the profession into disrepute
in marketing and promoting his self and his work.

Code of Ethics for Management Consultants

Code of Conduct for management consultants represents the attitude, principles and
approaches that have been found to contribute most to success and make for equitable and
satisfactory client relationship.

I. Basic Responsibilities of Management Consultants

Integrity and Objectivity
Any personal interest and other events or special relationship must be eliminated in order
to achieve integrity and don’t intentionally misinterpret facts to your advantage.

Independence
The consultant must be away from the influence of the enterprise served. Because there
must be integrity in the rendered service. And do not serve different enterprise at the same time
without knowing from each client.

Confidential Information
The only time that the information must be disclosed is by the consent of the client.
Keeping the information makes a good relationship with client. Disclosing information for you
own interest results in service without integrity.

II. Practice Standards for Management Consultants

Professional Competence
Do not take any engagements that will be not completed by your present professional
competence.

Planning, Supervision, and Due Care

Serve the enterprises with due care, from gathering data to drawing conclusion and giving
recommendation with supervision and must be beneficial to the enterprise.

Reporting Results
Give conclusion with professional judgement and develop realistic recommendations to
help the client improve the enterprise.

III. Fee Structure Standards for Management Consultants

Fees charged from the client must be reasonable with the basis of the service performed,
the time required to complete, benefits of the clients and experience of the consultant. Any fees
charged without reasonableness will result into a conflict of interest

IV. Business-Conduct Standards for Management Consultants

Conserve the profession by continuous advancing the standards by sharing and discussing
techniques with other consultants. Protecting it by avoiding engagements without integrity and
independence.