Introduction (350.1 to 350.2)
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Professional accountants are required to comply with the fundamental principles and apply the conceptual framework set out in Section 120 to identify, evaluate and address threats.

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Holding client assets creates a self-interest or other threat to compliance with the principles of professional behavior and objectivity. This section sets out specific requirements and application material relevant to applying the conceptual framework in such circumstances.

Requirements and Application Material

Before Taking Custody (R350.3 to 350.4 A1)
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A professional accountant shall not assume custody of client money or other assets unless permitted to do so by law and in accordance with any conditions under which such custody may be taken.

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As part of client and engagement acceptance procedures related to assuming custody of client money or assets, a professional accountant shall:

  • Make inquiries about the source of the assets; and

  • Consider related legal and regulatory obligations.

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350.4 A1

Inquiries about the source of client assets might reveal, for example, that the assets were derived from illegal activities, such as money laundering. In such circumstances, a threat would be created and the provisions of Section 360 would apply.

After Taking Custody (R350.5)
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A professional accountant entrusted with money or other assets belonging to others shall:

  • Comply with the laws and regulations relevant to holding and accounting for the assets;

  • Keep the assets separately from personal or firm assets;

  • Use the assets only for the purpose for which they are intended; and

  • Be ready at all times to account for the assets and any income, dividends, or gains generated, to any individuals entitled to that accounting.

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December 2021

You are now leaving the extant Code to view another version that contains passages that have either been superseded or that have been issued but are not yet effective.

This version of the eCode incorporates revisions to the Code to promote the role and mindset expected of professional accountants.

Revisions to the Code to promote the role and mindset expected of professional accountants will be effective as of December 31, 2021. Early adoption will be permitted


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