Professional Conduct Regulations
"Professionals are expected by employers, clients and by the public to adopt a higher standard of conduct and behaviour in their professional life. It is that which underpins our value and the confidence the public has in us as professionals. These rules set out those basic principles of minimum conduct. However ethics and professional conduct rules do more than that. The choices faced by a professional on a day to day basis are rarely black or white. Those choices are often made at a time when one is under pressure from a client or the clock. The professional rules help us judge our conduct by an objective benchmark at those difficult times. They provide us with a ready and polite reason for saying 'Sorry, I can't do that' when faced with pressure to stray across the line."
Professor Mark Watson-Gandy
Head of Professional Standards
The Institute of Certified Bookkeepers
- In Society a bookkeeper has a special role. Trust in the accounts and books of businesses and individuals is dependent on the bookkeeper's truthful, careful and diligent making and keeping of records. The purpose of these rules is to provide standards for members of The Institute of Certified Bookkeepers which are appropriate to their conduct in their employment and practice to the preservation of the dignity of their profession.
- The rules apply to all members of the Institute.
- The rules apply to the conduct of members in all jurisdictions.
- A member must comply with the requirements of these rules and any failure to do so shall constitute misconduct.
- The Board of the Institute shall have the power to waive the requirements of the rules in whole or in part and on such terms as it shall deem fit in respect of any of its members.
- The following words shall have the meanings set out below:
- "The Institute" The Institute of Certified Bookkeepers
- "member" Any member of the Institute of Certified Bookkeepers
- "services to the public" Any provision of services for reward other than to an employer.
- Any reference to the masculine shall be deemed to include the feminine.
- Any reference to an Act shall include any subsequent re-enactment.
THE FUNDAMENTAL PRINCIPLES
- A member may not engage in any activities which are likely to bring himself or the profession of bookkeeper or the Institute into disrepute.
A conviction for any criminal offence other than a road traffic offence shall for these purposes be deemed to amount to an activity which does or is likely to bring the member or the profession of bookkeeper or the Institute into disrepute.
- A member may not engage in dishonest or otherwise discreditable activities.
- A member must not compromise his professional standards or engage in or act as to assist or conceal any criminal act even if by doing so he may act contrary to the instructions of his client or his employer.
- A member is not obliged to accept any work and must not accept any work which:
- he lacks sufficient expertise or competence to complete
- would involve him or any other person in the commission of any criminal act
- he does not have adequate time or opportunity to complete promptly
- A member must promptly inform his client or his employer if for any reason it at any stage becomes apparent that he is unable to complete any work within a reasonable time of his being instructed to do so.
- A member must preserve the confidentiality of his client's or employer's affairs absolutely unless required to make such disclosure by law or by the direction of the Institute or to prevent the commission of a crime.
- A member must not hold client or trust funds for another.
- A member must not
- give tax advice
- give estate planning advice
- provide investment services or sell or give advice on the appropriateness of any investment within the meaning of the Financial Services & Markets Act 2000.
Provided that nothing herein shall prevent a member from doing any act he would otherwise be allowed to perform through his membership of some other professional body or under any current permission or licence granted by some other competent body.
- A member must not make or prepare any account or record which he knows is or may be false or misleading or the truth of which he is not satisfied on the materials or evidence before him.
- A member must at all times be courteous to all those with whom he has professional dealings.
- A member should ensure that any advice given to a client or employer is clearly and comprehensibly expressed.
- A member must not whether in his employment or in connection to his supply of services to the public describe himself or allow himself to be described as:
- holding any designation or qualification he does not currently hold or being a member of any body he is not currently a member of
- being an accountant unless he is currently entitled to be so described through his membership of an accountancy body
- being a Certified Bookkeeper unless he is currently entitled to through his belonging to the appropriate grade of membership of the Institute
- Subject to the other requirements of these rules, a member must always act in the interests of his client or employer.
- Members are reminded that under the present legislation, it is a serious criminal offence to obtain, conceal, retain or invest funds or property or to provide assistance to any person to do so, if members know or suspect that those funds or property are directly or indirectly the proceeds of criminal conduct or terrorist funding ["tainted money"]. Members are reminded that under UK law, criminal conduct is not limited to serious crime and that tax evasion is criminal conduct for these purposes.
- It is misconduct for a member to fail to make a report in writing to the appropriate authority if he either knows or suspects that such activities related to tainted money are being carried out. The relevant authority is, for these purposes, his Money Laundering Reporting Officer or, if none, to the Serious Organised Crime Agency ("SOCA").
- Members are reminded that under the present legislation, it is a serious criminal offence to do or disclose anything that might prejudice an investigation into such activities. Members must not make any disclosure which may tip off suspected money launderers that they are under investigation or doing any other thing that may prejudice such an investigation. Tipping off can be by word or action or by a failure to speak or act when such would normally be expected.
- Members are reminded that under the present legislation, it is a serious criminal offence to proceed with a reported transaction relating to tainted money without the consent of the appropriate authority or to fail to comply with a direction of the appropriate authority not to proceed with a transaction or business relationship.
- "Suspicion" means more than speculation but falling short of proof based on firm evidence. A particular set of circumstances which may be suspicious in relation to one client may not be suspicious in relation to another client. Examples of potentially suspicious transactions can include but are not limited to unusually large cash deposits, frequent exchange of cash into other currencies, difficulties identifying clients, any activity inconsistent with the normal business activity or any activity involving intermediaries or off-shore business arrangement where there is no clear business purpose underlying such arrangements.
- Where a disclosure is made of information a member has obtained in the course of business in the regulatory sector, members are reminded that it is a serious criminal offence under section 333A Proceeds of Crime Act 2002 to "tip off" any person that an investigation is being contemplated or is being carried out. The offence arises where the disclosure is likely to prejudice any investigation that might be conducted following the disclosure referred to in that subsection. Tipping off can be by word or action or by a failure to speak or act when such would normally be expected. This does not prevent a member from (a) Disclosing the matter to colleagues within the Member's own practice or (b) Disclosing the matter to the Member's Institute or (c) Disclosing information for the detection, investigation or prosecution of a criminal offence (whether in the United Kingdom or elsewhere), an investigation under the Proceeds of Crime Act 2002, or the enforcement of any order of a court under the Proceeds of Crime Act 2002.
- A Member in private practice should ensure that their employees and associates receive regular training to ensure that client identification procedures are carried out correctly and that knowledge and suspicions of money laundering or terrorist financing are reported.
- A Member in private practice who has either employees or associates should nominate an individual to receive and assess money laundering reports from colleagues and to make reports to the SOCA.
- Before any work is undertaken, a Member in private practice should undertake due diligence on the client in the following ways:
- Where the client is an individual: By obtaining independent evidence of the client's identity, such as a passport and proof of address and
- Where the client is a company or other legal entity: By obtaining proof of incorporation by establishing the prime business address and, where applicable, registered address by establishing the structure, management and ownership of the company(including the identity of any person who holds 25% of the shares or voting rights of the client) and by establishing the identities of those persons instructing the member on behalf of the company and verifying that those persons are authorised to do so and
- By establishing the identity and address of any other individuals exercising ultimate control over the client and/or who will be the ultimate beneficiaries of the work or transactions to be carried out and
- Where an intermediary is used on the instruction: By obtaining independent evidence of the client's identity, such as a passport and proof of address and
- By establishing precisely what work or transaction is desired to be carried out and to what purpose.
- If a member in private practice is unable to satisfy himself or herself as to the potential client's identity, no work should be undertaken. If at any time during the course of a client relationship the member begins to have doubts about the client's identity, further evidence should be obtained before work is carried out and a Report should immediately be made to the appropriate authority.
- A member in private practice should retain all client identification records for at least six years after the end of the client relationship. Records of all transactions and other work carried out should be retained for at least six years after the conclusion of the transaction.
- A member in private practice must put into place systems, controls and procedures to ensure continuing compliance with the legislation and ensure internal reporting. The internal controls include (where the practice is not a sole practice with no employees) appointing one person to be the practice's Money Laundering Reporting Officer ("MLRO") to have authority to and responsibility for receiving disclosures, assessing them and passing them on to and liaising with SOCA. The internal controls and policies must provide employees and associates and his MLRO with sufficient information by which he is able to judge the reasonableness of the suspicion and thereby assess which suspicions should be reported.
- A member in private practice must put into place systems, controls and procedures to ensure continuing compliance with the legislation and ensure appropriate risk assessment is undertaken of new and existing clients and that customer due diligence is undertaken and recorded on an ongoing basis
- Members must report their knowledge or suspicions of money laundering to the appropriate authority. Members must report such knowledge or suspicions to their MLRO and, when satisfied that there are reasonable grounds for suspicion, MLROs must report to SOCA.
- The Serious Organised Crime Agency (SOCA) can be contacted at Serious Organised Crime Agency, PO Box 8000, London SE11 5EN (telephone 0207 238 8282). Reports to SOCA must be made as soon as practicable in writing and on the standard form. The report should indicate the nature of and the reason for, suspicion, the suspect's full name, address, date of birth, nationality, occupation and employer, any identification or references seen or recorded, details of transactions or activities giving rise to knowledge or suspicion of money laundering, including amounts, dates, currencies, sources and estimations and any other information that may be relevant to the investigation, such as persons associated with the suspect.
- Members must undertake and review client due diligence on an ongoing basis and ensure that their records on clients are kept up to date
- It is misconduct for any members to fail to fully cooperate with any monitoring visit by the Institute. The monitoring visit will be conducted by a representative appointed by the Institute at the member's expense. Members will be given reasonable notice of any money laundering monitoring visit which will occur on a weekday during normal working hours. On the date of the visit, members must:-
- Promptly permit access to their premises by the representative of the Institute undertaking the monitoring visit
- Make available and promptly provide to the Institute's representative unrestricted access to every part of any file or record of the member or the member's practice or of any of the member's or the member's practice's clients
- Promptly reimburse the Institute for the costs of the monitoring visit by the representative undertaking the monitoring visit on the member.
- A member may supply bookkeeping services to the public provided that:
- he is qualified so to practice and holds a current Practice Licence granted by the Institute
- he holds a valid policy of professional indemnity insurance against claims for professional negligence appropriate to the size of the business but in any case not less than £50,000.
It is misconduct for a member to supply bookkeeping services to the public other than in compliance with this rule.
- A member must not undertake work for a client where the interests of him and his client conflict.
- A member entitled to provide bookkeeping services to the public may engage in any advertising or promotion provided that:
- it conforms with the British Code of Advertising Practice
- it is not inaccurate or likely to mislead
- it does not make comparisons with any other bookkeeper or accountant and it does not contain any derogatory remark or suggestion about any other bookkeeper or accountant.
- A member who is awarded a Practice Licence shall be granted permission to reproduce the Institute's coat of arms in full colour or single colour format on his stationery promotional material or in press and media advertisements including internet pages provided that:
- the coat of arms and name of the Institute are reproduced in full without alteration, adaptation or amendment
- the member's Practice number is carried in an appropriate size and position beneath the coat of arms
- the coat of arms is not reproduced in such a manner as to mislead clients or others into believing that the member has a higher grade of membership than that to which he is in fact entitled or that he is a "Certified Bookkeeper" unless he is a full Member or Fellow and is therefore entitled so to do
- the coat of arms is not used in such manner that clients or others may be mislead into believing that the member is employed by or working on behalf of the Institute.
- the coat of arms is not used in such manner that clients or others may be mislead into thinking that the Practising Certificate is awarded to the member's firm rather than to the member unless his firm is entitled so to do
- proof copy of each and every usage of the coat of arms is provided to the Institute in sufficient time prior to printing publication or transmission deadlines to enable the Institute to request or demand such alterations as are necessary to comply with the above.
- the member is granted permission in writing to use the coat of arms in desired format
Notwithstanding the foregoing permission shall not be unreasonably withheld.
- A member shall make and keep in place adequate provisions and arrangements for the continuation of his practice and the protection of his clients in the event of his death, illness or incapacity.
- In any professional correspondence in relation to bookkeeping work with any person with whom he has professional dealings, a member shall ensure that any letter he writes discloses either any designatory letters he is entitled to use after his name or (where he is entitled to do so) the description "Certified Bookkeeper" after his name.
- A member who is entitled to provide bookkeeping services to the public may trade using any trading name or style provided that:
- the trading name is lawful
- the trading name is consistent with the dignity of practice operated by members of a professional body.
- the trading name does not include the words "Certified Bookkeeper" or "Certified Bookkeepers" unless the principal in the case of sole trader practice or all the partners in the case of a partnership or all the directors in the case of a company are members of the Institute and are entitled to provide bookkeeping services to the public. Notwithstanding the foregoing, it shall be a defence for a member to have sought and been granted written approval by the Institute for any trading name.
- A member who has for the time being been entrusted with the files, documents or papers of any client must at all times hold and preserve them safely in a convenient and safe place and keep them separate from and unmixed with any other client files.
- A member who has for the time being been entrusted with the files, documents or papers of any client must at all times hold and preserve them in a convenient file, box or container bearing in clear lettering on its outside
- the name of the client to whom those papers belong and
- the current address of the client to whom those papers belong and
- the name and address of the member or practice which the client has engaged.
- A member must perform and complete all work for clients carefully, diligently and promptly.
- A member in practice shall ensure that his affairs are conducted so as to comply at all times with the requirements of the Data Protection Act 1998 and any statutory modifications of that Act which are, from time to time, in force.
DUTIES TO THE INSTITUTE
- A member must pay all membership subscriptions, Practising Certificates and professional indemnity fees for insurance premiums payable by him promptly on such sums being due.
- A member must inform the Institute of his address, telephone number and the name and address of his employer or practice and forthwith in the event of any change in these.
- A member must:
- respond promptly to any request by the Institute for information or comments or documents
- permit access forthwith on request to a duly appointed agent of the Institute to inspect the files and records of the member or of his clients
- report to the Institute the fact of his being convicted on any criminal offence in any jurisdiction or having been subject to a finding of a civil fraud or deceit by any civil court of competent jurisdiction or being disqualified from acting as a director
- attend any meeting he is required to attend of the Disciplinary Panel of the Institute
- comply with any direction of the Disciplinary Panel of the Institute
- report to the Institute in the event of his being made bankrupt or subject to any order under the Mental Health Act 1983
INVESTIGATION AND DISCIPLINARY HEARINGS
- A member commits misconduct if he
- fails to comply with these rules and fundamental principles, or,
- acts in breach of his any of his duties to the Institute or
- acts or has acted (whether or not in the course of his professional practice) in such a manner as to bring discredit to himself, the Institute or the profession of bookkeeper.
- Any complaint received by or initiated by the Institute shall be referred to a director of the Institute who shall for this purpose be appointed to investigate or make inquiries about the complaint for the purpose of enabling the Board to deal with it ["the Investigation Officer"].
- Upon the making of a complaint, the Investigation Officer shall write to the member notifying him of the substance of the complaint and inviting him to comment upon it within 21 days of the date of the Investigation Officer's letter.
- If it appears to the Investigation Officer that sufficient investigations have been undertaken, the Investigation Officer shall convene a meeting of not less than two members of the Board to consider the accusation: ["the Disciplinary Panel"].
- The member about whom the complaint has been received must have not less than 14 clear days notice of the hearing before the Disciplinary Panel. The notice shall be in writing and sufficient service shall be made by sending it by first class post to the address shown on the member's Institute membership records. The notice shall contain the following information:
- the date of the hearing before the Disciplinary Panel
- the location of the hearing before the Disciplinary Panel
- the nature of the allegation that has been made against the member
- his right to attend and represent himself at the hearing or be represented by counsel or a solicitor as he shall think fit
- his right to request copies of any documents that the Disciplinary Panel may be referred to
- that the hearing will be conducted in the English language
- if the Investigation Officer will be arguing that the complaint is not made out then the following words: "The Investigation Officer, having conducted his investigations and enquiries into complaint No..., forms the view that there is no satisfactory evidence against you IN RESPECT OF COMPLAINT NO... and will be inviting the Disciplinary Panel to formally DISMISS THAT CHARGE against you in respect of that Complaint. Whilst you have a right to attend that part of the hearing, you are not required to attend in respect of that complaint."
- The Investigation Officer shall attend to explain the substance of the complaint and present the evidence of any complaint and ask questions of the member (should he elect to give evidence) before the Disciplinary Panel but shall not participate in the considerations of the Disciplinary Panel.
- Any evidence given by the member shall be on oath.
- At hearing before the Disciplinary Panel the Panel may:
- admit evidence, whether written or oral, whether direct evidence or hearsay, and whether or not the same would be admissible in a court of law
- give directions as to the conduct of the hearing and the admission of evidence to ensure that the member has a proper opportunity of answering any charges that are made against him
- provided that they are satisfied that the procedure under rule 43 has been complied with, hear and make decisions on the complaint against the member notwithstanding his absence
- amend any charge against the member provided that they are satisfied the defendant will not suffer substantial prejudice in the conduct of his defence by the amendment
- make any inference of guilt or otherwise as shall seem appropriate in the circumstances from the member's failure to answer the complaint in writing or to attend in person at the hearing
- The Panel may:
- adjourn the hearing
- on finding that the complaint is trivial or not proved
- dismiss the complaint
- postpone the hearing pending further investigations or inquiry
- on a finding by a majority of the Disciplinary Panel present that any complaint is proved on the balance of probability, may deal with the complaint by making either no order or by imposing any one or more of the following penalties in respect of that complaint:
- give an informal or formal warning
- fine the member up to £15,000
- suspend the member from all or any of the privileges of membership for a stated period of time
- expel the member from the Institute
- order the member to pay all or any part of the costs of the investigation or hearing.
- If a notice is sent under rule 43 g) to the member, the Panel shall dismiss the complaint to which it relates.
- The Panel shall give short reasons for any decision and the Investigation Officer shall as soon as practicable thereafter send to the member confirmation of the decision in writing.
- Any member expelled from the Institute will immediately forfeit his interest and privileges as a member and any right (if any) to a refund of any unexpired part of his membership fee but will remain liable for any calls, membership fees or other money outstanding to the Institute at the date of his expulsion.
Professor Mark Watson-Gandy
Professor Mark Watson-Gandy was called to the Bar in 1990 and was made a Junior Counsel to the Crown in 2000. In 2004 he joined the Bar Council's panel of Young Spokesmen for the Bar.
He is a tenant at 13 Old Square Chambers. 13 Old Square is a specialist chancery/commercial barristers' chambers in Lincoln's Inn and was founded by leading chancery silk, John McDonnell QC. His work is primarily in the areas of insolvency and company law.
He is a Visiting Professor at the University of Westminster (Corporate Finance Law) and was the first practising barrister to hold the Institute of Chartered Accountant's Corporate Finance qualification. Dual qualified as an accountant, he is the author of "Watson-Gandy on Accountants" and the ICAEW Guide "Tax Advocacy". He has recently updated and co-authored the sections on Directors Duties in "Butterworths Corporate Law Service". He is Head of Professional Standards for the Institute of Certified Bookkeepers. He has acted for three of the UK's accountancy institutes and two of its second tier bodies and drafted the legislation on auditors for Dubai.
He represented the Nigerian Ports Authority in negotiations over the dredging of the Bonny Island Channel and advised the former Italian Prime Minister, Silvio Berlusconi, in his dispute with The Economist. He acted for the actress, Joan Collins, in her tax professional negligence case against her accountants. He advised in the restructuring of Sheffield United Football Club. He represented the Tamil Nadu Electricity Board on a £170 million private international law case over the building of a power station in India. His Holiness Pope Benedict recently made him a Knight of St Gregory the Great in recognition of "his work as a barrister for the Catholic Church".
Recent reported cases include DTI v Daniel (2002) The Times 8th April (instructed for the Secretary of State for Trade and Industry both at first instance and before the Court of Appeal in this human rights test case on the reverse burden of proof in bankruptcy prosecutions), Society of Lloyds v Levy  3 CMLR 56 (Lloyds Names challenge to premium claims under the Audit Directive) and Feetum v Levy (2005) The Times 28th February (the first case on the £50 million project finance exception to the bar on administrative receivers under the Enterprise Act 2002) and Khan v Nallamothu  All ER D (Oct) 60 (company hi-jack).