In 2017, the International Ethics Standards Board for Accountants (IESBA) updated the rule that dictates how accountants can respond to a client’s non-compliance with laws and regulations (NOCLAR). Essentially, NOCLAR is an action that violates a law or regulation that has a direct impact on financial statements or violates laws which address compliance matters.
NOCLAR is significant in that CPAs have strict confidentiality requirements with minimal exception to when they can divulge client or employer information without a client’s consent. Today, the NOCLAR standard is a response framework for an accountant’s decision-making process, when deciding if its necessary to divulge information to an outside body. A significant change for the profession.
So, what motivated this change in regulation, who does it affect and what are some of the concerns surrounding NOCLAR? NASBA Board of Directors member and owner of Audit Conduct, Catherine R. Allen, CPA, answered these questions and many others during a NASBAcast segment with Thomas Kenny, Director of Communications. Cathy has a specialized focus on ethics and institutional knowledge and is well-regarded within the accounting profession.
Watch the full segment in the video below.
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