Applying Principles of Professional Practice in the Financial Service Industry (Essay Sample)

Applying Principles of Professional Practice in the Financial Service Industry
Author’s Name
Institutional Affiliation

TASK 1
This issue of non compliance is a very serious problem. It is clear that the company procedures are not being followed by the general staff leading to the breaches in company codes and policies. The code of ethics for any organization governs the right and wrong conduct to be followed by the organization.
To remedy such threats to an organization, training programs need to be set up for the staff in order to make clear the company’s expectations of them. The training program will cover the company’s code of ethics and how to handle violations. In general, an employee who discovers a discrepancy in company policies should contact the relevant regulator and have the violation promptly corrected and necessary safeguards applied to curb it.
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Employees should adhere to the following fundamental principles in order to be able to maintain the smooth runnings and integrity of the organization.
Integrity – The organization requires that the employee be straightforward and honest in their daily operations
Objectivity – The organization requires that the employee not to allow bias or conflict of interest to influence business judgments
Professional competence and due care – The organization requires that the employee apply their professional knowledge in accordance with applicable technical and professional standards.
Confidentiality – The organization requires that the employee respect the confidentiality of information acquired as a result of professional and business relationships and, therefore, not disclose any such information to third parties without proper and specific authority.
Professional behaviour – The organization requires that the employee to avoid any action that discredits the profession.
The circumstances in which an employee operates may create specific threats to compliance with the fundamental principles. Taxing as it may be, it is important to define each situation that creates threats to the compliance with the fundamental principles and specify the appropriate action to remedy it (APESB, 2010).
TASK 2
In Australia there two ways in which laws are created:
Federal laws and
State Laws
Federal Laws cover everyone in Australia and in addition, the Federal Government can only pass laws under the power of the Constitution of Australia. On the other hand, State laws are created to cover peoples in particular states or territories. State laws are required in order to guide how conflicts are resolved between the States and Federal jurisdictions.
If there is a clash between federal and state or territory laws, the federal law overrides them (Equal Opportunities Commission, 2012).
TASK 3
The Sarbanes-Oxley Act 2002
As a response to the high-profile Enron and WorldCom financial scandals, the 2002 legislation introduced major changes to the regulation of financial practice and corporate governance to protect shareholders and the general public from accounting errors and fraudulent practices in the enterprise named after Senator Paul Sarbanes and Representative Michael Oxley, who were its main architects. The act is administered by the Securities and Exchange Commission ( HYPERLINK "http://searchfinancialsecurity.techtarget.com/definition/Securities-and-Exchange-Commission" SEC), which sets deadlines for compliance and publishes rules on requirements. Sarbanes-Oxley is not a set of business practices and does not specify how a business should store records; rather, it defines which records are to be stored and for how long.
The rules and regulations were designed for the may be necessary or appropriate in the public interest or for the protection of investors by improving the accuracy and reliability of corporate disclosures. Breaches carry criminal and civil penalties for offending executive managers and board directors. It substantially increased the accountability of directors and senior company officers.
This Legislation would be important for the new employee as it not only affects American companies but also companies trading with the US companies that have their shares listed with NASDAQ and also Australian subsidiaries of US parent companies according to the Sarbanes-Oxley Act (2002) (Rouse, 2007).
Privacy Act 1988
This Act is to make provision to protect the privacy of individuals, and for related purposes. This legislation is import ant for the employee as they will be dealing with sensitive information that they will have to keep confidential.
Insurance Act 1973
The main object of this Act is to protect the interests of policyholders and prospective policyholders under insurance policies (issued by general insurers and Lloyd’s underwriters in ways that are consistent with the continued development of a viable, competitive and innovative insurance industry.
This Act would be important for the new employee to know as it gives guidelines on the work related material in the financial sector:
restricting who can carry on insurance business in Australia by requiring them to meet certain suitability requirements
imposing primary responsibility for protecting the interests of policyholders on the directors and senior management of general insurers
imposing on general insurers requirements to promote prudent management of their insurance business
providing for policyholders, who have valid claims connected with certain policies
Banking Act 1959
The Act regulates banking in Australia and was recently amended by the Financial System Legislation Amendment (Financial Claims Scheme and Other Measures) Act 2008 (the Amendment Act) to put in place the Financial Claims Scheme (FCS). If the FCS is activated by the Treasurer, account-holders in an ADI are covered by the FCS for amounts in protected accounts subject to any threshold.
The definition of protected account is important in determining the coverage of the FCS. And also for the employees to know which financial product are covered like Saving accounts, call accounts, Term deposits, Current accounts, Cheque accounts etc
TASK 4
Yes, the manager is in breach of the Work Health and Safety Act 2011. This act states that the employer is to provide a balanced and nationally consistent framework to secure the health and safety of workers and workplaces by protecting workers and other persons against harm to their health, safety and welfare through the elimination or minimisation of risks arising from work. This is brought on by integrating continuous improvement and progressively higher standards of work health and safety.
The existence of boxes hindering the fire exit doorways poses a potential hazard if immediate evacuation was required. To have unsecured electric cables running across the floor causes risks such as tripping and also electrical shock if cables were to be exposed. The manager is clearly in breach of the legislation as he is not willing to minimize the risks available in the work place (Australia Capital Territory, 2013).
TASK 5
Yes, legally my colleague should be able to take time off to attend their religious service unless it is detrimental that the colleague be at work on that particular day for the sake of the organization.
The Equal Opportunity Act 1984, is an Act to promote equality of opportunity in Western Australia and to provide remedies in respect of discrimination on the grounds of sex, marital status, pregnancy, sexual orientation, family responsibility or family status, race, religious or political conviction, impairment, age, or publication of details on the Fines Enforcement Registrar’s website, or involving sexual or racial harassment or, in certain cases, on gender history grounds.
It would be an indicator for discrimination if the manager would not grant the time off without a valid reason.
Also, Title VII of the Civil Rights Act of 1964 prohibits employers from discriminating against individuals because of their religion in hiring, firing, and other terms and conditions of employment. It further states that employers to reasonably accommodate the religious practices of an employee unless to do so would create an undue hardship upon the employer (ADL, 2012 & Equal Opportunity Act 1984).
TASK 6
Karen would propose to Jane to firs, not let her emotions and feelings get the best of her while dealing with the clients this would shorten her career in the accounting firm.
Secondly Karen would advice Jane to contact her clients prior to the set appointment date and ask them to bring the required materials in order to lodge their returns. A friendly email that highlights the required items such as:-
Personal identification
Australian financial institution details
Medicare card or number
Private health insurance statement
Spouse details including details of income.
Also being calm at the job and accepting that the client might not always make her less stressed and happier. Also following up with a friendly call to remind the clients would work (Australian Taxation Office, 2013).
TASK 7
Beatrice shoul...