Acceptable level of ethical threat
An acceptable level is a level at which a reasonable and informed third party would likely conclude that the accountant complies with the fundamental ethical principles. The accountant identifies, evaluates and addresses threats in context, including new information and changing circumstances. The test is an objective assessment rather than personal reassurance.
Worked example
After evaluating a modest hospitality offer and the surrounding relationship, a firm considers whether a reasonable observer would believe objectivity remains intact.
Common mistake
Do not rely only on the accountant’s own belief that the relationship cannot influence judgement.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | AA | Supporting | September 2026–June 2027 |