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Global Ethics Board Resets Expectations of Professional Accountants Regarding Inducements

Jul 19, 2018 | New York, New York | English

The International Ethics Standards Board for Accountants® (IESBA®) today released new enhancements to its global ethics code which address more fully the responsibilities of professional accountants around the offering and accepting of inducements.

The revised standard sets out a comprehensive framework that more clearly delineates the boundaries of acceptable inducements, and guides the behavior and actions of professional accountants in business and in public practice in situations involving inducements.

“Incentives motivate behavior, and some inducements can be a powerful incentive to unethical behavior,” said IESBA Chairman Dr. Stavros Thomadakis. “This revised standard complements our standard on NOCLAR to offer a full system of ethical defenses that relate both to malfeasance committed by others and to accountants’ own involvement in potentially unethical behaviors.”

Central to this framework is a new intent test that prohibits the offering or accepting of inducements where there is actual or perceived intent to improperly influence the behavior of the recipient or of another individual. The framework also:

  • Clarifies the meaning of an inducement;
  • Establishes a requirement to understand and comply with laws and regulations that prohibit the offering or accepting of inducements in certain circumstances, such as in relation to bribery and corruption;
  • Guides professional accountants in applying the enhanced conceptual framework underpinning the International Code of Ethics for Professional Accountants (including International Independence Standards) where there is no improper intent; and
  • Provides enhanced guidance on the offering and accepting of inducements by professional accountants’ immediate or close family members.

The revised provisions become effective June 2019, including consequential amendments to the independence provisions of the Code addressing gifts and hospitality. The changes constitute the last piece of the recently revised and restructured Code.

About the IESBA

The IESBA is an independent standard-setting board that develops and issues, in the public interest, high-quality ethical standards and other pronouncements for professional accountants worldwide. Through its activities, the IESBA develops the International Code of Ethics for Professional AccountantsTM (including International Independence StandardsTM), which establishes ethical requirements for professional accountants. The structures and processes that support the operations of the IESBA are facilitated by IFAC. Please visit for more information, and follow us on Twitter @Ethics_Board.