Apply the five ethical principles in accounting
Use integrity, objectivity, professional competence and due care, confidentiality and professional behaviour to assess accounting conduct.
Cambridge International AS & A Level Accounting 9706, 2026–2028 syllabus, Version 2. These lessons cover the nine named IAS at the main-provisions level described in Cambridge teacher guidance, the stated ethical principles, audit and stewardship. Practice is self-checked, not an official Cambridge grade. Full timed Papers 1–4 and human subject-teacher review remain outstanding.
Before you begin
- Use the Topic 1.5 and 3.1 statement skills: identify the reporting period, distinguish profit from cash, and explain how a reporting choice affects users of financial statements.
Work on paper. Try each question before revealing help, and explain why your method works.
Quick readiness check
An accountant publishes a client's confidential sales data online without authorisation. Which principle is most directly breached?
What you will learn
- Explain why accounting needs an ethical framework
- Identify the five fundamental principles
- Select a reasoned response to a conflict without confusing ethics with legal advice
An ethical framework protects trust in accounting information
Accounting decisions affect owners, employees, lenders, customers, governments and communities. An ethical framework gives accountants a shared way to identify threats, consider duties and respond when pressure conflicts with reliable reporting. A rule-compliant calculation can still be misleading if evidence is selectively presented.
The five fundamental principles in this syllabus are integrity, objectivity, professional competence and due care, confidentiality, and professional behaviour. Integrity requires honest conduct; objectivity avoids bias and undue influence; competence and due care require current knowledge and careful work; confidentiality protects information; professional behaviour follows relevant rules and avoids discrediting the profession.
Respond to threats with evidence and safeguards
When a conflict appears, identify who may be affected, which principle is at risk, what evidence supports the proposed treatment, and what safeguards or escalation channels exist. A person facing pressure should document relevant facts, seek appropriate advice and follow organisational and professional procedures.
Confidentiality does not mean hiding wrongdoing from every authorised channel, and integrity does not permit breaching privacy casually. The appropriate response depends on duties and the circumstances. These lessons teach ethical reasoning, not jurisdiction-specific legal advice or a substitute for an employer's formal reporting process.
Pause and explain
An accountant accepts a task outside their current competence and does not seek support or training. Which principle is most directly at risk?
Worked example
A finance assistant is asked to delay recording an expense until next month so the current result meets a bonus target. The supplier invoice relates to goods used this month. Identify the ethical principles and a suitable first response.
Show the worked solution
- The request threatens integrity because it would knowingly misstate the period's results.
- It threatens objectivity because a bonus target is influencing judgement; competence and due care require checking the invoice and reporting period.
- The assistant should not make the unsupported entry, should document the facts, and should use the appropriate supervisory or ethics process.
Answer The request threatens integrity, objectivity and due care. The assistant should verify the evidence, refuse an unsupported deferral and raise the issue through the appropriate channel while protecting confidential information.
Try a topic test
Choose Easy, Normal or Difficult. Save your answers and open worked review after finishing.
Test this topic →From guided practice to a new situation
Write your answer and reasoning first. Use a hint only if you are stuck. The model solution is for self-checking; your written work is not automatically marked.
For each action, name the strongest principle at risk: (1) knowingly omitting a material expense; (2) sharing payroll data with a friend; (3) issuing a report without checking calculations.
Give me a hint
Match the conduct to honesty, information protection or competent careful work.
Compare my reasoning
- (1) Integrity is at risk because the omission is deliberate; objectivity may also be threatened by motive.
- (2) Confidentiality is at risk because private payroll information is shared without authorisation.
- (3) Professional competence and due care are at risk because the work was not properly checked.
(1) Integrity (and potentially objectivity); (2) confidentiality; (3) professional competence and due care.
Look for these in your work
- Each action matched
- Reason linked to facts
- More than one relevant principle allowed
A supplier offers an accountant an expensive personal gift while the accountant is reviewing that supplier's invoices. Explain the ethical threat and give two reasonable safeguards.
Give me a hint
Consider both actual bias and how the situation could appear to an informed observer.
Compare my reasoning
- The gift may create a self-interest or familiarity threat to objectivity and could undermine trust.
- The accountant should declare the offer and follow the organisation's gift policy, which may require refusing or returning it.
- A manager may reassign or independently review the work; record the decision and maintain evidence-based invoice checks.
The gift threatens actual and perceived objectivity. Declare it, follow the gift policy, refuse or return it if required, and use an independent review or reassignment safeguard.
Look for these in your work
- Threat identified
- Policy safeguard
- Independent check
An accountant is asked to send a client's draft results to a journalist who promises not to publish them. The journalist has no authorisation. Explain why good intentions do not remove the ethical conflict.
Give me a hint
Identify the duty attached to the information and distinguish permission from personal judgement.
Compare my reasoning
- The draft is confidential client information; an unauthorised disclosure may breach confidentiality.
- A journalist's promise does not create authority or remove the accountant's duty.
- Use an authorised reporting or disclosure process if a concern exists, seeking appropriate professional guidance rather than sharing the file informally.
Do not send the draft without authority. Good intentions do not replace consent, legal duty or an approved disclosure process; seek appropriate advice and use authorised channels.
Look for these in your work
- Confidentiality issue identified
- Authority checked
- Safe escalation suggested
Common mistakes
- Treating confidentiality as permission to conceal every concern
- Assuming an ethical threat proves fraud without evidence
- Naming a principle without explaining its connection to the facts
What can you explain now?
Which principle is most directly threatened when a manager biases an accounting estimate to meet a target?
Compare with the explanation
Objectivity
Undue influence can bias judgement, so objectivity is directly at risk; explain the other facts as well.
After trying it yourself, choose your next review. This is your self-assessment.
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Make it stick
Name all five fundamental ethical principles and give one example of a threat to any two of them.
If you needed the solution, close it and solve the problem again from a blank page. A correct answer is stronger when you can explain the reason for each step.