Ethics and Governance

Content Summary

Study guide: third edition

Ethics and governance are core components of the knowledge and skill base of today's professional accountants. As key business decision makers, accountants must be proficient in regulatory regimes, compliance requirements, and governance mechanisms to ensure lawful and effective corporate behaviour and operations.

A better understanding of ethics, corporate governance frameworks and mechanisms links with the various roles and responsibilities outlined in other subjects of the CPA Program. From an individual perspective, this subject provides you with the analytical and decision-making skills and knowledge to identify and resolve professional and ethical issues. The skills and knowledge obtained are also important for subjects that specialise in the functional disciplines of accounting, such as Advanced Taxation, Financial Reporting, Strategic Management Accounting and Advanced Audit and Assurance.

Today's professional accountants are less involved in traditional accounting functions and are more concerned with leadership and management. Today's accountants are leaders in their field providing key support to senior management and are directly involved in many important decisions. An understanding of ethics and governance is essential to those in leadership roles, and to those who support their leaders. This subject not only develops an awareness of corporate governance but also helps members (and those whom they support) in discharging their stewardship functions.

Exam structure

The Ethics and Governance exam is comprised of a combination of multiple-choice and extended response questions.

General objectives

On completion of this subject, you should be able to:

  • explain, from a global perspective, the nature of the accounting profession and the roles of professional accountants
  • apply the key professional responsibilities of an accountant from the perspective of a member of CPA Australia
  • explain the importance of ethics and professional judgment
  • describe key governance and regulatory frameworks, including international perspectives on corporate governance and the roles of various stakeholders
  • explain the expectations placed on various internal and external stakeholders arising from organisational governance responsibilities
  • ascertain various compliance and regulatory regimes impacting the global business environment
  • identify the strategic, leadership and global issues impacting accountants and the accounting profession
  • describe the nature, role and importance of corporate social responsibility, including climate change and sustainable development.

Subject content

The subject is divided into five modules.

The weighting column in the following table provides an indication of the emphasis placed on each module in the exam. The proportion of study time column is a guide for you to allocate your study time for each module.

Module Recommended proportion of study time (%) Weighting (%)
1. Accounting and society 15 15
2. Ethics 20 20
3. Governance concepts 25 25
4. Governance in practice 25 25
5. Corporate accountability 15 15

Subject outline

For further information, see the subject outline below.