Information Technology in Accounting and Professional Ethics
What the exam tests
This domain tests controls over computerised accounting systems and the ethical standards expected of a professional accountant, including the ICAN Code of Ethics.
Core rules
- IT general controls cover access, change management, backup, disaster recovery and cybersecurity; application controls cover input, processing and output.
- Segregation of duties, edit logs, reconciliation and independent review reduce the risk of error and fraud. Spreadsheets need version control and formula testing.
- Ethical principles: integrity, objectivity, professional competence and due care, confidentiality and professional behaviour.
- Threats include self-interest, self-review, advocacy, familiarity and intimidation; safeguards include disclosure, independent review, rotation and refusing the engagement.
Worked example
A financial controller is asked by the managing director to post a fictitious N5m sale so that a loan covenant is met. The controller faces a self-interest threat (job pressure) and possible intimidation. The correct response is to refuse to record the entry, explain that it misstates the financial statements, document the request, and escalate to those charged with governance or the audit committee. If the pressure continues, the controller should seek advice under the firm's ethical hotline and consider resignation. Confidentiality does not prevent reporting a legal or professional duty breach.
Traps
Do not treat confidentiality as absolute; disclosure may be required by law or professional duty. Do not rely on automated controls without testing them. Do not let an IT administrator both change master files and approve payments. Ethical threats must be identified and safeguarded, not ignored.