Governance, Ethics and Professional Conduct
Governance, Ethics and Professional Conduct tests board effectiveness, the Nigerian Code of Corporate Governance, CAMA 2020 duties, audit committees and the IESBA-based ICAN Code. Ethics questions are scenario-based and require the conceptual framework, not slogans.
Core rules
- NCCG 2018: principle-based; board composition, independence, chairman/CEO separation, board committees, risk management, whistleblowing and sustainability.
- CAMA 2020: directors' duties, conflicts, audit committee for public companies, remuneration and corporate responsibility.
- ICAN/IESBA fundamental principles: integrity, objectivity, professional competence and due care, confidentiality, professional behaviour.
- Threats: self-interest, self-review, advocacy, familiarity, intimidation; evaluate and address with safeguards or decline.
- NOCLAR: respond to identified or suspected non-compliance with laws and regulations.
- Audit committee: oversight of financial reporting, external and internal audit, and internal control.
Worked example: An audit senior's spouse holds shares in an audit client. The holding creates a self-interest and familiarity threat. Because the interest is direct and material, no safeguard reduces the threat to an acceptable level; the senior must be removed from the engagement, and the firm should consider whether the financial interest is prohibited. A small token gift with no intent to influence may be trivial, but a lavish gift during tender is not.
Traps: treating confidentiality as absolute; accepting management's assurance on a legal breach; confusing advocacy with audit; saying "disclose and continue" without evaluating materiality; ignoring audit committee independence.