Code of Ethics

Reasons for the Amendment of the Code of Ethics of the
Lebanese Association of Certified Public Accountants


The reasons that induce the ratification of Law No. 364/94 (organization of the profession of certified public accountants in Lebanon) lie in ensuring the independence of the public accountant, establishing rules and restrictions with which he shall comply, ensuring highly qualified and experienced practitioners of this profession, bearing responsibilities with high professional standards and ethics consecrated by the aforementioned law; thus determining the responsibilities, restrictions, and conditions of practicing the profession, taking into account the value and the prestige of this profession in the developed countries and its international importance, being one of the pillars of the financial markets and considering its relation with the classification of the institutions; in addition to having confidence in the financial information, and the factors that can ensure the credibility of such information at all local, regional and international levels and provide professionals in Lebanon with ability, reputation, and independence that allow them to gain the trust of those with whom they deal and the concerned parties.

The purpose of the Code of Ethics is to comply with the standards and objectives, namely:

Integrity and Objectivity – Professional Competence – respect of Professional Confidentiality, and Compliance with the Code of Ethics.

In September 14, 1996, His Excellency the Minister of Finance approved the Code of Ethics established at the time by the Board, and which still in vigor up to this date.

In view of the international development of the professional standards, the International Federation of Accountants issued a comprehensive regulation for the Code of Ethics, which included the basic principles and the general rules that tackle the procedures of practicing the profession and the professionals’ obligations towards themselves, their colleagues and the persons with whom they deal.

Further to this development, the Board deemed necessary to amend the Code of Ethics established in 1996, which became outdated, and to adopt the rules established by the International Federation which became binding on the professional bodies affiliated thereto.

In fact, the proposed Code of Ethics, hereby attached, complies with the international standards and correlates with the status and the condition of the profession in Lebanon; it is divided into four parts and each part is divided into sub-parts: 

First Part: Includes the fundamental principles represented by integrity, objectivity, professional competence, confidentiality, and the conduct to be followed by the association’s members.

Second Part: Includes the general rules related to the practice of the profession, the obligations of the professional accountant, the special arrangements, and the principles of full and total independence, thus rendering the reports submitted by the experts transparent, credible, and trustworthy for all the involved parties.

Third Part: Includes the obligations of the professional accountants in business as the enrollment list of  “LACPA” includes professional accountants in public practice and others in business, entitled to practice the profession independently when the conditions stipulated by the law are met.

Fourth Part: Addresses the professional associations that the expert is entitled to establish or participate therein in order to enhance the professional competence and offer wide knowledge to professional accountants.

It is worth mentioning that the proposed Code of Ethics does not contradict the previously established rules but develops and updates them in accordance with the international regulations and standards, which is necessary to adopt, as we are endeavoring to raise this profession at a level comparable with the advanced countries in this domain.


Considering the importance accorded to the compliance with the rules and regulations and the adoption of the latest standards and their application,

We hope that His Excellency the Minister of Finance approves the proposed Code of Ethics, pursuant to Article 36 – Paragraph 10 of Law 364/94 dated 1/8/1994 (organization of the profession of Certified Public Accountants in Lebanon.)

For the Board


Farid Gebran

Code of Ethics for Professional Accountants

Table of Contents 


Part 1: Fundamental Principles

110 Integrity

120 Objectivity

130 Professional Competence

140 Confidentiality

150 Professional Conduct (Behavior)

Part 2: General Rules  

Section 1: Mission Practice

211 Client Acceptance and Mission Safeguard

212 Collaboration of other Colleagues and Experts

213 Changes in Professional Appointment (Succession of Professional Accountants)

214 Fees and Remunerations

Section 2: Obligations

221 Relations among Colleagues(Fellowship)

222 Firm’s Organization

223 Permanent Training

224 Participation Fees

225 Conciliation (Conflict Resolution)

Section 3: Specific Arrangements

231 Advertisement and Publicity

232 CollectiveControl

Section 4: Rules of Independence

241 Banned Situations

242 Presumed Situations of Independence

243 Family, Personal and Financial Relationships

244 Fees and Remunerations

245 Tolerable Situations

Part 3: Professional Accountants in Business 

300 Introduction

310 Potential Conflicts

320 Preparation and Reporting of Information

330 Acting with Sufficient Expertise (Knowledge and Expertise)

340 Financial Interests

350 Inducements


Part 4: Professional Associations 




A distinguishing mark of the accountancy profession is its acceptance of the responsibility to act in the public interest. Therefore, a professional accountant’s responsibility is not exclusively to satisfy the needs of an individual client or employer. In acting in the public interest, a professional accountant shall observe and comply with the ethical requirements of this Code.

For this purpose, the professional rules of the Code of Ethics for Professional Accountants aim at:

First, underlining and emphasizing the main principles ruling the accountant’s behavior, and;

Second, explaining and clarifying the conditions of practice in order to enlighten the accountants themselves, the Chambers of Discipline and all authorities and parties in general that shall be informed about the accountant’s opinions. In fact, these rules of practice are in somehow perfectible since it is taken into consideration the evolutions that have occurred in the profession and the requirements, either current or predictable, of the financial information moving in high speed on national and international level.

This Code is in four parts. The first part establishes the fundamental principles of professional ethics for professional accountants and provides a conceptual framework for applying those principles. In fact, the conceptual framework provides guidance on fundamental ethical principles. Professional accountants are required to apply this conceptual framework to identify threats (risks) to compliance with the fundamental principles, to evaluate their significance and, if such threats are other than clearly insignificant to apply safeguards to eliminate them or reduce them to an acceptable level such that compliance with the fundamental principles is not compromised.

Whereas, the second and the third parts illustrate how the conceptual framework is to be applied in specific situations: Part 2 applies to professional accountants in public practice; Part 3 applies to professional accountants in business.

As to the fourth part, it covers the professional associations that the professional accountants are authorized to join.  

Part 1

Fundamental Principles

Conceptual Framework Approach

A professional accountant has an obligation to evaluate any threats to compliance with the fundamental principles when the professional accountant knows, or could reasonably be expected to know, of circumstances or relationships that may compromise compliance with the fundamental principles.

A professional accountant shall take qualitative as well as quantitative factors into account when considering the significance of a threat. If a professional accountant cannot implement appropriate safeguards, the professional accountant shall decline or discontinue the specific professional service involved, or where necessary resign from the client (in the case of a professional accountant in public practice) or the employing organization (in the case of a professional accountant in business).

A professional accountant may inadvertently violate a provision of this Code. Such an inadvertent violation, depending on the nature and significance of the matter, may not compromise compliance with the fundamental principles provided, once the violation is discovered, the violation is corrected promptly and any necessary safeguards are applied.

Threats and Safeguards

Compliance with the fundamental principles may potentially be threatened by a broad range of circumstances. Many threats fall into the following categories:

(a) Self-interest threats, which may occur as a result of the financial or other interests of a professional accountant or of an immediate or close family member; 

(b) Self-review threats, which may occur when a previous judgment needs to be reevaluated by the professional accountant responsible for that judgment; 

(c) Advocacy threats, which may occur when a professional accountant promotes a position or opinion to the point that subsequent objectivity may be compromised; 

(d) Familiarity threats, which may occur when, because of a close relationship, a professional accountant becomes too sympathetic to the interests of others; and 

(e) Intimidation threats, which may occur when a professional accountant may be deterred from acting objectively by threats, actual or perceived.

Safeguards that may eliminate or reduce such threats to an acceptable level fall into two broad categories:

(a) Safeguards created by the profession, legislation or regulation; and

(b) Safeguards in the work environment.

Safeguards created by the profession, legislation or regulation include, but are not

restricted to:

• Educational, training and experience requirements for entry into the profession

• Continuing professional development requirements

• Corporate governance regulations

• Professional standards

• Professional or regulatory monitoring and disciplinary procedures

• External review by a legally empowered third party of the reports, returns, communications or information produced by a professional accountant.

In exercising professional judgment, a professional accountant shall consider how a reasonable and informed third party, having knowledge of all relevant information, including the significance of the threat and the safeguards applied, would conclude to be unacceptable.


Ethical Conflict Resolution

In evaluating compliance with the fundamental principles, a professional accountant may be required to resolve a conflict in the application of fundamental principles.

When initiating either a formal or informal conflict resolution process, a professional accountant shall consider the following, either individually or together with others, as part of the resolution process:

(a) Relevant facts; 

(b) Ethical issues involved; 

(c) Fundamental principles related to the matter in question; 

(d) Established internal procedures; and 

(e) Alternative courses of action.

Having considered these issues, a professional accountant shall determine the appropriate course of action that is consistent with the fundamental principles identified. The professional accountant shall also weigh the consequences of each possible course of action. If the matter remains unresolved, the professional accountant shall consult with other appropriate persons within the firm or employing organization for help in obtaining resolution.

Where a matter involves a conflict with, or within, an organization, a professional accountant shall also consider consulting with those charged with governance of the organization, such as the board of directors or the audit committee.

It may be in the best interests of the professional accountant to document the substance of the issue and details of any discussions held or decisions taken, concerning that issue.

If a significant conflict cannot be resolved, a professional accountant may wish to obtain professional advice from the relevant professional body or legal advisors, and thereby obtain guidance on ethical issues without breaching confidentiality. For example, a professional accountant may have encountered a fraud, the reporting of which could breach the professional accountant’s responsibility to respect confidentiality. The professional accountant shall consider obtaining legal advice to determine whether there is a requirement to report.

If, after exhausting all relevant possibilities, the ethical conflict remains unresolved, a professional accountant shall, where possible, refuse to remain associated with the matter creating the conflict. The professional accountant may determine that, in the circumstances, it is appropriate to withdraw from the engagement team or specific assignment, or to resign altogether from the engagement, the firm or the employing organization.

Fundamental Principles

A professional accountant is required to comply with the following fundamental principles:

(110) Integrity

(120) Objectivity

(130) Professional Competence and Due Care

(140) Confidentiality

(150) Professional Behavior 


110: Integrity

110.1 The principle of integrity imposes an obligation on all professional accountants to be straightforward and honest in professional and business relationships. Integrity also implies fair dealing and truthfulness.

110.2 A professional accountant shall not be associated with reports, returns, communications or other information where they believe that the information:

(a) Contains a materially false or misleading statement;

(b) Contains statements or information furnished recklessly; or

(c) Omits or obscures information required to be included where such omission or

obscurity would be misleading.



120: Objectivity

120.1 The principle of objectivity imposes an obligation on all professional accountants not to compromise their professional or business judgment because of bias, conflict of interest or the undue influence of others.

120.2 A professional accountant may be exposed to situations that may impair objectivity. It is impracticable to define and prescribe all such situations. Relationships that bias or unduly influence the professional judgment of the professional accountant shall be avoided. 


130: Professional Competence and Due Care

130.1 The principle of professional competence and due care imposes the following

obligations on professional accountants:

(a) To maintain professional knowledge and skill at the level required to ensure that clients or employers receive competent professional service; and

(b) To act diligently in accordance with applicable technical and professional

standards when providing professional services.

130.2 Competent professional service requires the exercise of sound judgment in applying professional knowledge and skills in the performance of such service. Professional competence may be divided into two separate phases:

(a) Attainment of professional competence; and

(b) Maintenance of professional competence.

130.3 The maintenance of professional competence requires a continuing awareness and an understanding of relevant technical and professional developments.

Continuing professional development develops and maintains the capabilities that enable a professional accountant to perform competently within the professional environments.

130.4 Diligence encompasses the responsibility to act in accordance with the requirements of an assignment, carefully, thoroughly and on a timely basis. 

130.5 A professional accountant shall take steps to ensure that those working under his authority in a professional capacity have appropriate training and supervision. 

130.6 Where appropriate, a professional accountant shall make clients, employers or other users of the professional services aware of limitations inherent in the services to avoid the misinterpretation of an expression of opinion as an assertion of fact.

140: Confidentiality

140.1 The principle of confidentiality imposes an obligation on professional accountants to refrain from:

(a) Disclosing outside the firm or employing organization confidential information acquired as a result of professional and business relationships without proper and specific authority or unless there is a legal or professional right or duty to disclose; and

(b) Using confidential information acquired as a result of professional and business relationships to their personal advantage or the advantage of third parties.

140.2 A professional accountant shall maintain confidentiality even in a social environment. The professional accountant shall be alert to the possibility of inadvertent disclosure, particularly in circumstances involving long association with a business associate or a close or immediate family member.

140.3 A professional accountant shall also maintain confidentiality of information disclosed by a prospective client or employer.

140.4 A professional accountant shall also consider the need to maintain confidentiality of information within the firm or employing organization.

140.5 A professional accountant shall take all reasonable steps to ensure that staff under the professional accountant’s control and persons from whom advice and assistance is obtained respect the professional accountant’s duty of confidentiality.

140.6 The need to comply with the principle of confidentiality continues even after the end of relationships between a professional accountant and a client or employer. When a professional accountant changes employment or acquires a new client, the professional accountant is entitled to use prior experience. The professional accountant shall not, however, use or disclose any confidential information either acquired or received as a result of a professional or business relationship. 

140.7 The following are circumstances where professional accountants are or may be required to disclose confidential information or when such disclosure may be appropriate:

(a) Disclosure authorized by law and is authorized by the client or the employer;

(b) Disclosure required by law, for example:

(1) Submission of documents and files required by law;

(2) Production of documents or other provision of evidence in the course of

legal proceedings; or

(3) Disclosure to the appropriate public authorities of infringements of the law

that come to light; and

(c) There is a professional duty or right to disclose, when not prohibited by law:

(1) To comply with the quality review of a member body or professional body;

(2) To respond to an inquiry or investigation by a member body or regulatory


(3) To protect the professional interests of a professional accountant in legal

proceedings; or

(4) To comply with technical standards and ethics requirements. 

140.8 While deciding whether to disclose confidential information, professional accountants shall consider the following points:

(a) Whether the interests of all parties, including third parties whose interests may be affected, could be harmed if the client or employer consents to the disclosure of information by the professional accountant;

(b) Whether all the relevant information is known and substantiated, to the extent it is practicable; when the situation involves unsubstantiated facts, incomplete

information or unsubstantiated conclusions, professional judgment shall be used in determining the type of disclosure to be made, if any; and

(c) The type of communication that is expected and to whom it is addressed; in particular, professional accountants shall be satisfied that the parties to whom the communication is addressed are appropriate recipients. 


150: Professional Behavior

150.1 The principle of professional behavior imposes an obligation on professional

accountants to comply with relevant laws and regulations and avoid any action that may bring discredit to the profession. This includes actions which a reasonable and informed third party, having knowledge of all relevant information, would conclude negatively affects the good reputation of the profession.


150.2 In marketing and promoting themselves and their work, professional accountants

shall not bring the profession into disrepute. Professional accountants shall be

honest and truthful and shall not:

(a) Make exaggerated claims for the services they are able to offer, the qualifications they possess, or experience they have gained; or

(b) Make disparaging references or unsubstantiated comparisons to the work of


Part 2

General Rules

Section 1: Mission Practice


211:  Client Acceptance and Mission’s Safeguard


211.1 Before accepting a new client, a professional accountant in public practice shall consider whether acceptance would create any threats to compliance with the fundamental principles.

211.2 Client conduct, which might threaten compliance with the fundamental principles,  can be represented by the client involvement in illegal activities (such as money laundering), dishonesty or questionable financial reporting practices.

211.3 The significance of any threats shall be evaluated.

211.4 Appropriate safeguards may include collecting data and a better understanding of the client, its owners, managers and those responsible for its governance and business activities; in addition to verifying the client’s commitment to improve corporate governance practices and internal controls.

211.5 Where it is not possible to reduce the threats to an acceptable level, a professional

accountant in public practice shall refuse the new mission.

211.6 The professional accountant shall periodically review his mission to monitor client’s obligations.

In brief, the acceptance of the mission requires the following steps:

Ø Appropriate understanding and knowledge of the client’s business nature

Ø Independence and absence of any threats to compatibility

Ø Professional competence  and readiness to deal with such type of businesses

Ø Contact with previous auditor/s, if any

Ø Written mission acceptance

Ø Fulfillment of other professional engagements resulting from the mission acceptance 

On the other hand, the auditor shall examine and check the list of his duties and obligations in order to determine the cases that may challenge or question the mission’s safeguard:

Ø Appearance of elements threatening his independence and/or the compatibility

Ø Appearance of situations against the provisions and rules of co-auditorship

Ø  Frequency of reserves and refusal to certify due to :

1.      Serious irregularities

2.      Insufficient fees and remunerations, without  any increase

3.      Refusal of the firm to abide by and apply the standards

212: Collaboration of Other Colleagues and Expert

The professional accountant may be represented by/ or may rely on the assistance of other assistants or independent experts; however, he cannot assign his power nor transfer the mission, the responsibility of which is undertaken by him. Moreover, the accountant shall guarantee that the collaborators or experts respect and abide by the same ethical standards.

 213: Changes in a Professional Appointment

A professional accountant in public practice, who is asked to replace another professional accountant in his mission coming to its end, shall determine the reasons for not accepting the renewal of the appointment; whether it was the decision of the company to elude the effects of practicing the mission, or the refusal of the company to accept the schedule set by the professional accountant.

214: Fees and Remunerations 

214.1 When entering into negotiations regarding professional services, a professional accountant in public practice may quote whatever fee deemed to be appropriate. The fact that one professional accountant in public practice may quote a fee lower than another is not in itself unethical. Nevertheless, there may be threats to compliance with the fundamental principles arising from the level of fees quoted.

214.2 The significance of such threats will depend on factors such as the level of fee quoted and the services to which it applies. In view of these potential threats, safeguards that may be adopted include:

Ø      Making the client aware of the terms of the engagement and, in particular, the basis on which fees are charged and which services are covered by the quoted fee.

Ø      Assigning appropriate time and qualified staff to the task. 

214.3 Contingent fees are widely used for certain types of non-assurance engagements.2They may, however, give rise to threats to compliance with the fundamental principles in certain circumstances. The significance of such threats will depend on factors including:

Ø      The nature of the engagement,

Ø      The range of possible fee amounts,        

Ø      The basis for setting the fees,

Ø      Whether the outcome or result of the transaction is to be reviewed by an
independent third party.

214.4 The significance of such threats shall be evaluated and such safeguards may include:

Ø      An advance written agreement with the client as to the basis of remuneration,

Ø      Disclosure to intended users of the work performed by the professional
 accountant in public practice and the basis of remuneration

Ø      Quality control policies and procedures

Ø      Review by an objective third party of the work performed by the professional accountant in public practice

214.5 A professional accountant in public practice shall not pay or receive a referral fee or commission, unless the professional accountant in public practice has established safeguards and adopted procedures to eliminate the threats or reduce them to an acceptable level. Such safeguards may include:

Ø      Disclosing to the client any arrangements to pay a referral fee to another
 professional accountant for the work referred,

Ø      Disclosing to the client any arrangements to receive a referral fee for referring the client to another professional accountant in public practice,

Ø      Obtaining advance agreement from the client for commission arrangements related to the sale by a third party of goods or services to the client. 


Section 2: Obligations 


 221: Fellowship

All the Association’ members shall maintain good relations of courtesy among colleagues. In fact, they owe to each other moral assistance and they shall refuse any mission or refrain from doing any action that may harm the worthiness of a colleague or tarnish the image of the Association. 

222: Firm Organization

Actually, the firm’s organization and the internal procedures contribute in assuring the independence of the professional accountant’s opinion.

223: Permanent Training

Every expert of the association shall dedicate certain number of hours for the permanent professional training, and provide necessary training for his colleagues in order to maintain the high level of competence and expertise required to accomplish the mission.

224: Participation Fees

Every member shall settle his participation fees due to the association.

225: Conciliation (Conflict Resolution)

Every professional dispute among members of the association, unsettled amicably, shall be submitted to the President.

Section 3: Specific Arrangements

231: Advertisement and Publicity

It is forbidden to have recourse to any kind of publicity or advertisement consisting in diffusing information about services rendered by the firm and its qualifications in the purpose to sign new engagements and missions. As well, no type of procedures consisting in performing direct approaches, personalized and not upon demand of the potential client, and aiming at offering professional services is allowed.

A professional accountant in public practice shall not bring the profession into

disrepute when marketing professional services. The professional accountant in public practice shall be honest and truthful and shall not:

Ø Make exaggerated claims for services offers, qualifications possessed or

experience gained; or

Ø Make disparaging references to unsubstantiated comparisons to the work of


If the professional accountant in public practice is in doubt whether a proposed form of advertising or marketing is appropriate, he shall consult with the relevant professional body.

However, it is allowed to bring to the knowledge of others, upon demand, some information about the firm and services.

In fact, the board can authorize any communication deemed useful for the profession.

232: Collective Control

It is incumbent upon the co-auditors to jointly draft the principles of organizing their mission. In whatever case, they shall take into consideration:

Ø   Their joint responsibility that represents, for every auditor, the necessity to better know the aspects, nature and environment of the firm; and particularly to be mindful of the main risks; and supervise the tasks already accomplished.

Ø   The efficiency of the mission that shall be maintained by avoiding duplication or omission of some procedures.

Ø   The technical methods and the professional competences that distinguish every co-auditor and constitute a reliable source. In fact, it can never represent an obstacle impeding the reciprocal accessibility to files and documents in everyone’s possession.

In fact, the collective practice of the mission, resulting from these general principles of organization, allows the co-auditors to contribute and intervene either in the meetings held with the company’s administrative department and other concerned sections, or during the discussions and negotiations with the directors concerning, for example, the status of accounts or the accounting treatment methods applied in the case of complicated transactions.  

Regardless the case and the situations, the schedule and the work plan are elaborated jointly. In fact, this schedule determines the nature and the volume of works, the relative remunerations and fees and the methods of organizing the mission and repartition of tasks between the co-auditors.

Section 4: Rules of Independence  

It is in the public interest, and in conformity with the Code of Ethics, that the assurance teams, firms and network firms be independent of assurance clients.

Independence requires: 

Independence of Mind

The state of mind that permits the expression of a conclusion without being affected by influences that compromise professional judgment, allowing an individual to act with integrity and objectivity.

Independence in Appearance

The avoidance of significant facts and circumstances that can lead a well informed third party to intimidate integrity, objectivity or professional skepticism.  

241:  Banned Situations

It is forbidden that the professional accountant:

Ø   Be employed by other than legal entity or natural persons registered as auditors or certified public accountants; or other than teaching courses related to the profession.

Ø   Practice any commercial activity either directly or through an intermediary.

242: Presumed Situations of Independence

Some situations constitute presumptions of independence:

Ø Book keeping and preparation of the financial statements of the audited company (except the case of exceptional limited assistance while  elaborating the consolidated financial statements),

Ø Benefits that may lead the auditor to express an opinion on the documents, evaluations or declarations that he contributed in drawing up,

Ø The evaluations elaborated as separate tasks,

Ø Participation in negotiations or arrangements as to merger or acquisition,

Ø When the Professional Public Accountant is requested to act as defender for the audited firm, or to be involved in management decisions,

Ø Interventions by means of commissions paid by third parties,

Ø Recruitment missions,

243: Family, Personal and Financial Relationships

Family and personal relationships between the auditor and the audited company may create doubts about his objectivity and impartiality. The auditor executing a job, personally or on behalf of a legal entity, cannot intervene in a company where an immediate family member or a personal relation, creating a dependence bonds, occupies a managerial post or has a financial interest. As well, he is not allowed to receive from the audited company neither loans nor special profit and even to hold nominal parts in the firm in subject.

244: Fees and Remunerations

The total fees and remunerations of a firm for one or many missions in one company or group of companies shall not represent a part that may create a situation of financial dependence. This part is estimated on long-term basis, taking into consideration the total of the office’s remunerations for all the missions.

245Tolerable Situations

The mission of the auditor can include opinions, recommendations and advices pertinent to attitudes taken or suggested by the audited firm in the following fields:

Ø The accounting of all types and nature of transactions according to the principle of regularity and sincerity of the accounts,

Ø Financial information.

Are also included in his mission, for they contribute in its efficiency, the advices, the opinions and recommendations as to the elaboration of:

Ø Manuals of principles and accounting method,

Ø Accounting systems and organization,

Ø Procedures, and all measures aiming at improving the internal control in general.

If requested, the auditor can precise the changes to add or he can express an opinion on the modifications suggested by the boards; however, he is to be considered overstepping his mission and tasks if proceeding personally  to execute these changes or to take up the management and consequently the responsibility.

The auditor gives occasional opinions, recommendations and advices on the limits aforesaid. He cannot be appointed to a particular mission, even by tacit agreement, to follow up some issues in order to provide the company with useful advices. In such a case he would be achieving the tasks of other persons and thus led to give advices causing interference with the management.   

Consequently, the auditor cannot be paid separately for his opinions, recommendations and advices standing the fact that these latter fall under his job description. However, if he finds out that the advices and recommendations have required much time and effort, he is entitled to ask for an increase of his remunerations.

On the other hand, the mission of the auditor does not include the tasks irrelevant to auditing:

Ø Consultancy in the field of marketing, and mass media

Ø Consultancy on the production of the firm

Ø Management Consultancy

Ø Legal and fiscal consultancy

Part 3

Professional Accountants in Business

300 Introduction

300.1 A professional accountant in business may be a salaried employee, a partner, director (whether executive or non-executive), an owner manager, a volunteer or another working for one or more employing organization. The legal form of the relationship with the employing organization, if any, has no bearing on the ethical responsibilities incumbent on the professional accountant in business.

300.2 A professional accountant in business has a responsibility to serve the aims of their employing organization. This Code does not seek to hinder a professional accountant in business from properly fulfilling that responsibility, but calls to consider circumstances in which conflicts may be created with the absolute duty to comply with the fundamental principles.

Threats and Safeguards


300.3 Compliance with the fundamental principles may potentially be threatened by a broad range of circumstances. Many threats fall into the following categories:

(a) Self-interest,

(b) Self-review,

(c) Advocacy,

(d) Familiarity and

(e) Intimidation 

300.4 In circumstances where a professional accountant in business believes that unethical behavior or actions by others will continue to occur within the employing organization, the professional accountant in business shall consider seeking legal advice. In those extreme situations where all available safeguards have been exhausted and it is not possible to reduce the threat to an acceptable level, a professional accountant in business may conclude that it is appropriate to resign from the employing organization.                      

310: Potential Conflicts

310.1 A professional accountant in business has a professional obligation to comply with the fundamental principles. There may be times, however, when their responsibilities to an employing organization and the professional obligations to comply with the fundamental principles are in conflict.

310.2 As a consequence of responsibilities to an employing organization, a professional

accountant in business may be under pressure to act or behave in ways that could

directly or indirectly, threaten compliance with the fundamental principles. A professional accountant in business may face pressure to:

Ø    Act contrary to law or regulation

Ø    Act contrary to technical or professional standards

Ø    Facilitate unethical or illegal earnings management strategies

Ø    Lie to, or otherwise intentionally mislead (including misleading by remaining silent) others, in particular:

- The auditors of the employing organization; or

- Regulators.

Ø    Issue, or otherwise be associated with, a financial or non-financial report that materially misrepresents the facts, including relevant statements.

320: Preparation and Reporting of Information

320.1 Professional accountants in business are often involved in the preparation and reporting of information that may either be made public or used by others inside or outside the employing organization. A professional accountant in business shall prepare or present such information fairly, honestly and in accordance with relevant professional standards so that the information will be understood in its context.

320.3 A professional accountant in business shall maintain information, for which the

he is responsible in a manner that :

(a) Describes clearly the true nature of business transactions, assets or liabilities;

(b) Classifies and records information in a timely and proper manner; and

(c) Represents the facts accurately and completely in all material respects.

320.3 Where it is impossible to reduce the threat to an acceptable level, a professional accountant in business shall refuse to remain associated with information they consider is or may be misleading. Should the professional accountant in business be aware that the issuance of misleading information is either significant or persistent; the professional accountant in business shall consider informing appropriate authorities in line with the guidance in Section 140. The professional accountant in business may also wish to seek legal advice or resign. 

330: Acting with Sufficient Expertise

The fundamental principle of professional competence and due care requires that a professional accountant in business shall only undertake significant tasks for which the professional accountant in business has, or can obtain, sufficient specific training or experience. A professional accountant in business shall not intentionally mislead an employer as to the level of expertise or experience possessed, nor shall a professional accountant in business fail to seek appropriate expert advice and assistance when required.

340: Financial Interests

340.1 Professional accountants in business may have financial interests, or may know of

financial interests of immediate or close family members, that could, in certain circumstances, give rise to threats to compliance with the fundamental principles.

340.2 In evaluating the significance of such a threat, professional accountants in business must examine the nature of the financial interest. This includes an evaluation of the significance of the financial interest and whether it is direct or


340.3 A professional accountant in business shall neither manipulate information nor use confidential information for personal gain.


350: Inducements 

Receiving Offers

350.1 A professional accountant in business or an immediate or close family member may be offered an inducement. Inducements may take various forms, including gifts, hospitality, preferential treatment and inappropriate appeals to friendship or loyalty. 

Making Offers 

350.2 A professional accountant in business may be in a situation where the professional

accountant in business is expected to, or is under other pressure to, offer inducements to subordinate the judgment of another individual or organization, influence a decision making process or obtain confidential information.

350.3 A professional accountant in business shall not offer an inducement to improperly influence professional judgment of a third party.

350.4 Where the pressure to offer an unethical inducement comes from the employing organization, the professional accountant shall follow the principles and guidance regarding ethical conflict resolution set out in Part 1 of this Code.

Part 4

Professional Associations  



Professional accountants have the right to group together to form professional associations. These latter can be converted into groups or unions in accordance with the legislation in force.
To liaise closely with the Association, professional groups shall submit to the Board, within one month starting the date of their establishment:

1. A statement by registered mail with acknowledgment of receipt containing family names, first names, qualifications and addresses of the founders, an indication of the headquarters, and a duplicate of the statutes; 

2. A Statement of amendments brought to aforesaid requirements.

 Within this framework, the professional associations must respect:

The powers specifically reserved to the Board and other bodies that it has established;

Members’ rights and obligations and other companies recognized by him, as stipulated by laws and regulations, bylaws and the Code of Professional Conduct (code of ethics), as to relations among members, with clients, with the Association and public administrations. 

On the other hand, every professional clustering enlightened and freely organized and guided to serve, not only the profession but also the country’s economy, must be privileged with audience and support amongst the Board.



The amendment of the Code of Professional Conduct relative to the Lebanese Association of the Certified Public Accounts was ratified during Board meeting held on January 18, 2006.

 The amendment was ratified by His Excellency the Minister of Finance Dr. Jihad Azour, pursuant to decision 1/463 dated April 2, 2006.