the UNIVERSITY of GREENWICH 1 July 2009 L5b Audit and assurance J. E. Spencer-Wood Audit and Assurance Lecture 5b Confidentiality

the UNIVERSITY of GREENWICH 2 July 2009 L5b Audit and assurance J. E. Spencer-Wood Confidentiality There is a professional duty not to disclose information about a client (without consent) In the UK the duty of confidentiality is an implied contractual duty In some circumstances fraud must be reported to an appropriate proper (third party) authority in the public interest (fe police, FSA regulatory bodies, HMRC, SE)

the UNIVERSITY of GREENWICH 3 July 2009 L5b Audit and assurance J. E. Spencer-Wood A ‘Chinese Wall’ A physical separation of departments and information within an audit firm To prevent the use of data in non-audit contexts without a client’s permission Common law (UK) - Chinese walls

the UNIVERSITY of GREENWICH 4 July 2009 L5b Audit and assurance J. E. Spencer-Wood Requirements for a valid ‘Chinese Wall’ 1.Physical separation of departments 2.Training about treatment of confidentiality 3.Strict, defined procedures (including recording) when crossing the wall 4.Compliance officers monitoring effectiveness of wall 5.Disciplinary sanctions for breaches (Refer the Prince Jefri case - ) Common law (UK) - Chinese walls

the UNIVERSITY of GREENWICH 5 July 2009 L5b Audit and assurance J. E. Spencer-Wood Further reading House of Lords (1998) Prince Jefri Bolkiah v. K.P.M.G /prince01.htmhttp:// 1218/prince01.htm Kelly, E. (1999) Hong Kong Lawyer