Clone of Responding to Non-Compliance with Laws and Regulations

The NOCLAR provisions in the International Code of Ethics for Professional Accountants (including International Independence Standards) establish a global framework for how professional accountants should respond when they encounter potential or actual illegal acts by a client or employer.

By providing a clear and practical response process, the standard helps professional accountants act in the public interest — taking appropriate action, escalating matters within the organization or to relevant authorities when necessary, and reinforcing that “turning a blind eye” is not an option. In doing so, NOCLAR strengthens ethical conduct, accountability, and public trust in the profession.

The NOCLAR provisions make clear that ethical responsibility extends beyond the audit or the financial statements. They guide all professional accountants — in business and in private practice — to apply professional judgment, courage, and integrity when faced with possible wrongdoing.

The IESBA has developed videos, fact sheets, and Q&A publications to help practitioners, firms, educators, and regulators understand how to apply the framework in practice and how to integrate it into firm culture, governance, and ethics training.

The NOCLAR standard applies to all professional accountants, with proportionate requirements for four categories: auditors, other professional accountants in public practice, professional accountants in business in senior roles, and other professional accountants in business.

Since its issuance in 2016, many jurisdictions have adopted or aligned their national codes with the IESBA’s NOCLAR provisions. These efforts strengthen ethical leadership and reinforce the profession’s role in promoting good governance, transparency, and accountability across sectors.

The IESBA continues to support adoption through guidance materials, outreach, and cooperation with regulators, national standard setters, and professional accountancy organizations, ensuring consistent global application of the standard.