1 AN ETHICAL FRAMEWORK Ethics refers to a system or code of conduct based on moral duties and obligations that indicates how an individual should behave. Professionalism refers to the conduct, aims, or qualities that characterize or mark a profession or professional person.

2 THEORIES OF ETHICAL BEHAVIOR Utilitarianism Rights-based approach Justice-based approach

3 THE SIX STAGES OF ETHICAL DEVELOPMENT I.The individual's actions are judged in terms of obedience and avoidance of punishment. II.The individual is aware of others’ needs but is motivated by their own needs. III.The individual attempts to conform to group norms. IV.The individual is concerned for order in society and its rules. V.The individual views social contracts and mutual obligations as important. VI.The individual bases actions on universal moral and ethical principles that apply to all individuals and groups.

4 CODE OF PROFESSIONAL CONDUCT Principles of Professional Conduct. Rules of Professional Conduct. Interpretations of Rules of Conduct.

5 PRINCIPLES OF PROFESSIONAL CONDUCT Responsibilities. The public interest. Integrity. Objectivity and independence. Due care. Scope and nature of services.

6 INDEPENDENCE AND OBJECTIVITY Independence in fact and in appearance Activities that would indicate a lack of independence include:  Direct or indirect ownership by member of member’s family in a client.  Economic dependence on a client.  Indebtedness to a client.  Performance of management functions.

7 INTEGRITY AND DUE CARE Reputation for integrity is very important. Due care – a level of care or skill that could be expected.

8 MAINTENANCE OF THE REPUTAION OF THE PROFESSION Sustain his or her professional competence. Not become associated with any misleading documents or misleading representations. Disclose any relationships which might cause impairment of objectivity. Not act as an advocate for a client. Report to the disciplinary committee any breaches of the Rules of Conduct by other members.

9 OTHER RULES Confidentiality of information. Advertising and solicitation.

10 QUALITY CONTROL A system of quality control for a firm encompasses the firm's organizational structure and policies adopted and procedures established to provide the firm with reasonable assurance of conforming with professional standards.

11 ELEMENTS OF QUALITY CONTROL Clients Independence and objectivity. Personnel management - hiring. Engagement procedures – engagement letter. Practice administration – firm name. Quality control review program – internal review.

12 MONITORING QUALITY CONTROL Practice inspection. Self-monitoring.