14. ethics, ICAB, KL, Study Manual

Taxation- | Study Manual
Chapter l4
Ethics
Contents
lntroduction
Examination context
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14.3 r Disclosu.e of information
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14.4 Conflict of interest
14.5 r Basic principles of axation work
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14.7 ' Anti-money laundering
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Less VAT deposit balance on the morning of 27 June 2004
Funher VAT deposit to made through Treasury Challan on 27 June 2004
Taxation-l Study Manual
Some Worked Examples and Solutions:
Worked Example I
Sonali Paper & Board Mills Limited produces Duplex Board, declaring its price at Tk 40,000 per metric
ton. lt received an order on 25 June 2OO4 from British American Tobacco (Bangladesh) Co Ltd to deliver
500 metric tons of duplex board on 27 June 2004. lt intended to deliver the goods on 27 June 2OO5 if
VAT could be paid by then. The company had a VAT deposit balance on the mtrningof 27 june 2004 in
the amount of Tk 10,00,000.
Calculate the amount to be deposited by the company on 27 June 2004 to enable it to despatch the
goods on that date.
Solution l:
VAT chargeable and payable on 500 MTs Tk 40,000x500x | 5%
Taka
30,00,000
t0.00.000
20.00.000
Worked Example 2:
Asset Development & Holdings Ltd sold an apartmeng D-4, of 2000 sft to Mr Abdul Karim in Asset plaza
in Gulshan, Dhaka at a cost ok Tk 40,00,000. The company wants ro deliver the aparuTenr toiMr Karim
on 30 August 2004. The Deed of Agreemenr specifies that vAT is payable by Mr Karim.
Calculate the VAT payable by Mr Karim.
Solution 2:
VAT chargeable and payable Tk 40,00,000x | . 5 %=_[!_60,009
Worked Example 3:
Modhumati Sweets deals in sweets and milk products at 74 Mirpur Road, Dhanmondi, Dhaka. lt obtained
registration for the purpose of turnover tax. lt has declared that its yearly sales during the income year
ending 3 | December 2004 would amounr to Tk 12,00,000; and ir wants to pay turnover tax on a monthly
basis.
Calculate monthly turnover tax of Modhumati Sweets.
Solution 3:
Turnover tax for the income year ending 3l December 2oo4 Tk 12,00,000x4% = Tk 49.000
Monthly turnover rax Tk 48,OOO/ 12 = Tk 4.000
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Introduction
Learning objectives
. ldentiff the guidance given in the IFAC
relation to a tax practice with regard to:
r Disclosure of information
r Conflict of interest
o Confidentiality
Code of Ethics for Professional Accountants in
Practical significance
Belonging to a professional body requires adherence to a code of ethics and have had claims for
breaches of confidentiality. This is part of what differehtiates a Chartered Accountant from
unqualified accountants. Clients, members of the public, and the governmenr recognise that we
are reguired to adhere to exactinS standards and so expect a certain standard of behaviour from
Money laundering has been a maior problem in the past and as part of new laws designed to
combat this, professionals are required to participate in its prevention by reporting certain
suspicions relating to the proceeds of crime.
Stop and think
Accountants have been fined for non-compliance with the Code of Ethics. Even in the short time
that the. anti-money laundering regulations have existed accounrants have been prosecuted. lt is
essential that professional accountants should act ethically in all of their worlc
Working context
Ethical considerations underpin all of your studies as well as your work experience. you will
often make ethical decisions without even realising it" but sometimes you may find yourself in a
quandary and be unsure how to act. This is when the Code of Ethics will be of assistance. you
need to know what to look out for and how to acc You should always take particular care in
relation to client confidentiality; not always an easy task.
Syllabus links
The topics covered in this chapter are. essential knowledge for the whole of your Taxation
studies' They will ensure that advice and communication is appropriate and in keeping with the
requiremen$ of the ICAB.
Tick Off
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Taption-l Study Manual
Examination context
Exam requirements
In the examination, candidates may be required to:
. APPIy the five fundamenal principles to given scenarios
. Deiermine safeguards to be put in place when threats are made to the fundamdnal principles
, Advise on the ethical resolution of conflicts
r Give appropriate guidance relating to conflicts of interest and money laundering
Question practace
For question pracdce on these topics go to the end of this manual covering this chapter
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14.0 Fundamentalprinciples
Section Overview
by professional
) The lnternational Federation of Accountants (IFAC) has produced a Code of Ethics for
professional accountants ('IFAC Code').
)
t
lcAB has adopted and published IFAC code of Ethics for rcAB Members.
The IFAC code aims to ensure high quarity ethicar standards for use
accountants around the world.
) Part A of both the IFAC Codes ('the Codes') establish the fundamental principles of
professional ethics for accounurnts.
14.0. 1 Fundamental principles
Definition
Professional accountant A member of the ICAB.
The Codes require a professional accountanr to comply with
principles:
. Integrity
. Obiectivity
. Professional competence and due care
. Confidentiality
. Professionalbehaviour
The purpose of this, chapter is to provide background information which will assist your
understanding of the framework of the Bangladesh taxation s/stem, why governments impose cu
and the principles of taxation.
The Bangladesh taxation system has developed over cenuries from the then British India in lg60
to the Present condition on a piecemeal basis. Successive ruler and tovernme6ts have changed
the taxation system in accordance with their political objectives. Thire has-nser been an all-
party political consensus about how the Bangladesh taxation system should be changed and there
probably never will be.
14.0.2 lntegrity .
Defnition
Integrity: Reguires all professional accountants to be straightforward and honest in professional
and business relationships.
A professional accountant should not be associated with any information where he believes that
the information:
r Contains a materially false or misleading statement
r Contains statemenE or informadon furnished recklessly
r Omits or obscures information reguired to be includei where such omission or obscurity
would be misleading
the following five fundamental
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14.0.3 Objectivity
Definition
Obiectivity: lmposes an obligation on professional accountants not to comPromise their
professional or business judgement because of bias, conflict of interest or the undue influence of
others.
Relationships rhat bias or unduly influence the professional iudgement of the professional
accountant should be avoided.
| 4.0.4 Professional comPetence and due care
Definition
Professional competence and due care: Requires professional accountants to:
i Mainein professional knowledge and skill at the level required to ensure that clients or
employers receive competent professional service based on current developmenc in
practice, legislation and techniques; and
. Acr diligendy in accordance with applicable technical and professional standards when
providing professional services.
Competent professional service requires comPetence to be achieved in two phases:
. Attainment of professional competence; and
. Maintenance of professional competence, requiring a continuing awareness and
understanding of relevant issues.
Steps should be taken to ensure that those
appropriate training and supervision.
working for the professional accountant have
A professional accountant should maintain confidentiality even in a social environment. The
professional accounrant should be alert to the possibility of inadvenent disclosure, particularly in
circumstances involving long association with a business associate or a close or immediate family
member.
A professional accountant should also consider the need to maintain confidentiality of
information within the firm. All reasonable steps should be taken to ensure that staff under the
Any limitations relating to the service being provided must be made.clear to clients and other
users to ensure that misinterpretation of facts or opinions does not take place.
| 4.0.5 Confidentiality
Definition
Confidentiality: lmposes an obligation on professional accountants to refrain from:
' Disclosing outside the firm confidential information acquired as a result of professional and
business ielationships wirhout proper and specific authority or unless there is a legal or
professional right or duty to disclose; and
. iJsing confidential information acquired as a result of professional and business relationships
to their personal advantage or the advantate of third Pafties'
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@The Institute of Chartered Accountants of Bangladesh

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Professional accountant's control and persons from whom advice and assistance is obtained
respecr the professional accoununt's duty of confidentialiry.
A professional accountant should also mainain confidentialiry of information disclosed by a
prospective client or employer.
The need to comply with the principle of confidentiality continues even after the end of
reladonships between a professional accountant and a client or employer. When a professional
accountant changes employment or acquires a new clieng the professional accountant is entitled
to use prior experience. The professional accountant should nog however, use or disclose any
confidential information either acquired or received as a result of a professional or business
relarionship.
14.0.6 Professional behaviour
Definition
Professional behaviour: lmposes an obligation on a professional accountant to comply with
relevant laws and regulations and avoid any action rhat may bring discredit to the profession.
This includes acdons which a reasonable and informed third parry, having knowledge of all
relevant information, would conclude negatively affects the good reputation oith" profession.
Professional accountants should be honest and truthful and should not:
r Make exaggerated claims for the services they are able to offer, the qualificmions they
possess, or experience they have gained
r Make disparaging references or unsubstantiated comparisons to the work of others
14. I Threats and safeguards framework
Section Overview
The circumstances in which professional accountants openrte may give rise to specific
threats to compliance with the five fundamental principles.
The codes provide a framework to help identifr, evaluate and respond t<i these threats.
The professional accountant is then able to apply safeguards to eliminate the threa6 or
reduce them to an acceptable level.
As a result, compliance with the five fundamentat principles is not compromised.
l4.l.l Threats
The professional accounant is obliged to evaluate any threat as soon as he knows, or should be
expected to know, of its existence
Both- qualitative and quantitative factors should be taken into account in considering the
significance of the threat.
Most threats to compliance with the fundamental principles fall into the following caregories:
' Self interest threats, which may occur as a result of the financial or other interests of a
professional accountant or of an immediate or close family member
' Self'review threats' which may occur when a previous iudgment needs to be re-evaluated
by the professional accounrant responsible for that judgment
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. Advocacy threats, which may occur when a professional accountant promotes a position
or opinion to the point that subsequent obiectivity may be comPromised
. Familiarity threats, which may occur when, because of a close relationship, a professional
accountant becomes too symPathetic to the interests of others
. Intimidation threats, which may occur when a professional accountant may be deterred
from acting obiectively by threats, actual or perceived
14.1.2 Safeguards
lf a professional accountant cannot implement appropriate safeguards, he should decline or
discontinue the specific professional service involved, or where necessary resign from the client.
Safeguards that may eliminate or reduce such threats to an acceptable level fall into two broad
categories:
' Safeguards created by the profession, legislation or regulation'
' Safeguards in the work environment.
Safeguards created by the profession, legislation or regulation include, but are not restricted to:
. Educational, training and experience requirements for entry into the profession
' Continuing professional development requirements
. Corporategovernanceregulations
. Professionalstandards
. Professional or regulatory monitoring and disciplinary procedures
. External review by a legally empowered third party of the reports, returns, communications
or information produced by a professional accounhnt
Certain safeguards may increase the likelihood of identifying or deterring unethical behaviour.
Such safeguards, which may be created by the accounting profession, legislation, regulation or an
employing organisation, include, but are not restricted to:
' Effective, well publicised complaints systems operated by the employing organisation, the
proiession or a regulator, which enable colleagues, employers and members of the public to
draw attention to unprofessional or unethical behavior
' An explicitly stated duty to rePort breaches of ethical requirements
The nature of the safeguards to be applied will vary depending on the circumstances. In
exercising professional judgment, a professional accountant should consider what a reasonable
and informed third party, having knowledge of all relevant information, including the significance
ofthe threat and the safeguards applied, would conclude to be unacceptable.
14,2 Ethical conflict resolution
Section Overview
) To ensure compliance with the fundamental principles a professional accountant may need to
resolve a conflict in applying the principles.
) The conflict resolution process may be formal or informal.
) In both cases the same steps are to be followed.
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14.2. I Conflict resolution process
When initiating either a formal or informal conflict resolution process, a professional accountant
should consider the following five factors:
. Relevant facts
. Relevant parties
. Ethical issues involved
. Fundamental principles related to the matter in question
. Established internal procedures
. AlternatNe courses of action
Having considered these issues, the appropriate course of acrion can be determined which
resolves the conflict with all or some of the five fundamental principles. lf the matter remains
unresolved, the professional accountant should consult with other appropriate persons within
the firm for help in obtaining resolution.
Where a matter involves a conflict with, or within, an organisation, a professional accountant
should also consider consulting with those charged with governance of the organisation.
It is advisable for the professional accountant to document the issue and details of any
discussions held or decisions taken, concerning that issue.
lf a significant conflict cannot be resolved, a professional accountant may wish to obrain
professional advice from the relevant professional body or legal advisors, and thereby obtain
guidance on ethical and legal issues without breaching confidentiality.
lf, after exhausting all relevant possibilities, the ethical conflict remains unresolved, a professional
accountant should, where possible, refuse to remain associated with the matter creating the
conflict.
The professional accountant may determine that, in the circumshnces, it is appropriate to
withdraw from the engagement team or specific assignment, or to resign altogether from the
engagement or the firm.
lnteractive question l: Ethical conflict resolution [Difficulty level: Exam standard]
Mr.J, a member of the ICAB, is the reporting accountant of a high profile charitable organisation.
Over the years he has become firm friends with the financial controller Mr. G.
Recently he has become concerned that funds have been withdrawn from the bank account
without the correct approval. Mr. J has mentioned this to Mr. G, who explained that there was
no problem with this.
Mr. J does not wish to upset Mr. G but is not satisfied with the explanation.
Requirement
ldentify the five factors to be considered by J when initiating a formal or informal conflict
resolution.
Answer
When initiating either a formal or informal conflict resolution process, Mr. J should consider the
following:
. Relevant facts
. Relevant parties
. Ethical issues involved
r Fundamental principles related to the matter in question
. Established internal procedures
r Alternative courses of action
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Taxadon- I Study Manual
Interactive question 2: Ethical conflict resolution [Difficulty level: Exam standard]
The same hcts as above.
After considering the five factors G decided to consult the Finance Director, Ms. B, to resolve
the issue.
J feels that Ms. B has not taken sufficient steps to resolve the issue.
Requirement
Outline the options open to G.
Answer
Mr. J may wish to obtain professional advice from the ICAB or legal advisors, and thereby obtain
guidance on ethical issues without breaching confidentiality. J should consider obtaining legal
advice to determine whether there is a requirement to reporr
lf the ethical conflict remains unresolved, J should refuse to remain associated with the matter
creating the conflict. He may determine that, in the circumstances, it is appropriate to resign
altogether from the assignment.
| 4.3 Disclosure of information
Section Overview
) Pan A ofthe Codes contains a section relating to confidentiality.
) The confidentiality section explains when a professional accountant may disclose information
to third parties wirhout threatening the fundamental principle of confidentiality.
14.3.1 When to disclose
A professional accountant may disclose confidential information if:
. Disclosure is permicted by law and is authorised by the client or the employer
. Disclosure is required by law' for example:
- Production of documents or other provision of evidence in the course of legal
proceedings, or
- Disclosure to the appropriate public authorities of infringements of the law, e.g. under
antimony laundering legislation
. There is a professional duty or right to disclose, when not prohibited by law:
- To comply with the quality review of a member body or professional body
- To respond to an inquiry or investigation by a member body or regulatory body
- To protect the professional interests of a professional accountant in legal proceedings
- To comply with technical standards and ethics requirements
| 4.3.2 Factors to consider regarding disclosure
In deciding whether to disclose confidential information, professional accountants should
consider dre following:
. Whether the interests of all parties, including third parties whose interests may be affected,
could be harmed if the client or employer consents to the disclosure of information by the
professional accountant
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. Whether all the relevant information is known and substantiated, to the extent it is
practicable to do so. When the situation involves unsubstantiated facts, incomplete
information or unsubstantiated conclusions, professional iudgment should be used in
determining the type of disclosure to be made, if any
. The type of communication that is expected and to whom it is addressed; in particular,
professional accountants should be satisfied that the parties to whom the communication is
addressed are appropriate recipients
44.4 Conflicts of interest
Section Overview
Part B of both the IFAC Code and the ICAEW Code illustrate how the fundamental
principles are applied in certain situations for professional accountants in public practice.
One of the illusrations given in part B contains details relating to conflicts of interest.
| 4.4. I The threat of a conflict of interest
A professional accountant should take reasonable steps to identify circumstances that could pose
a conflict of interest. These may give rise to threats to compliance with the fundamental
principles.
A conflict may arise between the firm and the client or between two conflicting clients being
managed by the same firm. For example where a firm acts for both a husband and wife in a
divorce settlement or acts for a company and for its directors in their personal capaciry.
Worked example: Conflict of interest
A professional accountant in public practice competes directly with a client or has a joint venture
or similar arrangement with a major competitor of a client.
Requirement
Which fundamental principle may be threatened by this conflict?
Solution
A threat to objectivity may be created.
Evaluation of threas includes consideration as to whether the professional accountant has any
business interests or relationships with the client or a third party that could give rise to threats.
lf threats are other than clearly insignificant, safeguards should be considered and applied as
necessary.
| 4.4.2 Safeguards
Depending upon the circumstances giving rise to the conflict, safeguards should ordinarily include
the professional accountant in public practice:
. Notifying the client of the firm's business interest or activities that may represent a conflict
of interest
' Notifying all known relevant parties that the professional accountant is acting for two or
more parties in respect of a matter where their respective interests are in conflict
' Notifying the client that the professional accountant does not act exclusively for any one
client in the provision of proposed services (for example, in a particular market sector or
with respect to a specific service)
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@The Institute of Chartered Accountans of Bangladesh

' In each case the Professional accountant should obtain the consent of the relevant paruies to
acL
Where a Professional accoununt has requested consent from a client ro acr for another pamy
(which may or may not be an existing client) and that consent has been refused, then he must
not continue to act for one of the parties in the matter giving rise to the conflict of interest.
The following additional safeguards should also be considered:
The use of separate engagement teams
Procedures to Prevent access to information (eg strict physical separation of such teams,
confidential and secure daa filing)
' Clear guidelines for members of the engagement team on issues of security and
confidentialiry
' The use of confidentiality agreements signed by employees and partners of the firm
' Regular review of the application of safeguards by a senior individual not involved wirh
relevant client engagements
Where a conflict of interest poses a threat to one or more of the fundamental principles that
cannot be eliminated or reduced to an acceptable level through the application of safeguards, the
professional accountant should conclude that it is not appropriate to accept a specific
engagement or that resignation from one or more conflicting engagemenB is required.
14.5 Basic principles of taxation work
Section Overview
.) One of the topics included in the statement is an explanation as to the accountant's
relationship with the clienc
14.5. I Agent or principal
It is very imponant that it is understood when an accountant is acting as an atent on behalf of a
client and when he is acting as the principal. The two different capacities carry different degrees
of risk and potential liability.
An explanation as to when an accountant is acting in each capacity should be given in a client
engagement letter. The letter should also explain the scope of the client's and the accoun&rntrs
responsibilities in each case.
14.5.2 Agent
An accountantacts as agentwhen he merelyprepares documents on behalf of aclient. The client
rehins responsibility for the accuracy of the document itself. The accounant is thus an agent
when performing tax compliance work such as preparing and submitting a tax return on behalf of
a client- The client would be required to sign the return prior to its submission.
The accountant takes no responsibility for any information which he passes on to the tax
authorities when acting as an agent. The accountant is not normally liable if any of the
information proves to be incorrect.
Acting as an atent is therefore considered to be a low risk activity.
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14.5.3 Principal
An accountant acts as principal when he provides advice to the client as to the tixation
consequences of different courses of action. The accountant takes full responsibility for the
advice given and may be liable to the taxpayer in the event the advice turns out to be incorrect
or inappropriate.
Where an accountant does not have the professional skill required to act as a principal in a
particular case he may still accept the engagement. However, he must ensure that the opinion of
a suitably qualified accountant is sought.
Acting as a principal is therefore considered to be a high risk activity.
14.6 Tax Authorities errors
Section Overview
I One of the topics included in the statement is Tax Authorities errors.
14.6. I Tax Authorities errors
It may be apparent to the professional accountant that a mistake has been made by Tax
Authorities. such as:
. The raising of an inadequate assessment
. An under collection of tax or interest
. An over repayment of tax or interest
The miseke may be
. One of law
. A calculation or clerical error
. A misunderstanding on the part of Tax Authorities of the facts as presented
Professional accountants are advised to include in their letters of engaSement authority to advise
Tax Authorities of errors, so that consent from the client is not needed. Where no such
authority has been obtained, the procedure set out below must be followed.
Where the accountant becomes aware that Tax Authorities, in full possession of the facts, has
made a material error in dealing with the affairs of a clieng the professional accountant should
seek the client's authority to advise Tax Authorities of the error.
In cases of an Tax Authorities error, unless the tax at stake is de minimis, the professional
accountant should refer the matter to the client. The client should be:
a
a
Asked to authorise the professional accountant to advise Tax Authorities of the error; and
Warned of the possible legal consequences if he is reluctant to give the authority sought,
including interest and penalties and possible criminal prosecution; and
Advised that if consent is not given, the accountant will consider taking independent legal
advice with a view to:
Notifying Tax Authorities in any event, and notifyint the client of his action; and
Ceasing to act for the client.
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The professional accountant should ensure that a written record is kept of all advice given to
clients in connection with Tax Authorities errors.
lf a professional accountant is specifically asked by Tax Authorities to atree a figure, he must
agree what he believes to be the correct figure; this may be a figure negodated in the course of
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discussions followingfull disclosure of the facts and circumstances. He may nor accept a figure he
knows to be incorrect, and he does not need to seek his client's aurhority to disclose to Tax
Authorities its errors in this case.
14.7 Anti-moneylaundering
Section Overview
) Money Laundering Prevention Acq 2002 has been Published with the purpose of
combating money laundering
) Accountants should comply the requirement relating ro money-laundering
14.7.1 Money laundering
Definition
Money laundering is che process of changing large amounts of money obtained from crimes, such
as drug trafficking, into origination from a legitimate source.
Money Laundering is the process by which criminals attempt to conceal rhe true oritin and
ownership of the proceeds of criminal activities. lf successful, the money can lose its criminal
identity and appear legitimate.
In terms of section 2 (tha) of Money Laundering Prevention Act, 2002, "Money Laundering means
(a) Properties acquired or earned directly or indirectly through illegal means; (b) lllegal transfer,
conversion, concealment of location or assistance in the above act of the properties acquired or
earned directly or indirectly through legal or illegal means." In this Act, "Properties means
movable or immovable properties of any nature and description".
The term Money Laundering is used for a number of offences involving the proceeds of crime or
terrorist funds. It now includes possessing, or in any way dealing with, or concealing, the
proceeds of any crime.
Someone is engaged in money laundering under where they:
. Acquire or earn properties direcdy or indirectly through illegal means
' Transfer, conveG conceal location or assist in the above act of the properties acquired or
earned direcdy or indirectly through legal or illegal means
Where a professional accountant suspects that a client is involved in money laundering he should
report this to the authorities.
14.7.2 Tax related ofiences
Tax related offences are not in a special category. The proceeds or monetary advantage arising
from tax offences are treated no differently from the proceeds of thefg drug trafticking or other
criminal conducL
Tax evasion consists of seeking to mislead Tax Authorities by either:
. Suppressing information to which Tax Authoriries is entitled, for example by:
- Failing to nodry Tax Authorities of a liability to tax
- Understaring income or gains
- Omitting to disclose a relevant fact
or
. Providing Tax Authorities with deliberately false information, for example by:
- Deducting expenses that have not been incurred
- Claiming capital allowances on plant that has not been purchased

Minor cases of tax evasion are generally settled out of court via the payment of penalties.
However, there is a statutoD/ offence of evading income tax that can be dealt with in a
magistrales court.
Serious cases of tax evasion, particularly those involving fraud, continue to be the subject of
criminal prosecutions which may lead to fines and/or imprisonment on conviction.
Furthermore, tax evasion offences will fall within the definition of money laundering and in
certain cases individuals may be prosecuted under one of the money laundering offences. This
includes both the under declaring of income and the over claiming of expenses.
lf the assets of any clients were derived from illegal activities or if the client has committed tax
evasion that considered under money laundering, a threat to compliance with the fundamental
principles would be created. In such situations, the professional accountant may consider seeking
legal advice and he should report this to the authorities.
Tax avoidance, however, is legal and includes any legal method of reducing an individual's tax
burden.
14.7.3 Anti-money laundering procedures
Businesses need to maintain the some procedures, in respect of all relevant business such as:
I Appoint a Money Laundering Reponing Officer (MLRO) and implement internal reportinS
procedures
Train staff to ensure that they are aware of the relevant legislation, know how to recognise
and deal with potential money laundering, how to report suspicions to the MLRO, and how
to identify clients
Establish internal procedures appropriate to deter and prevent money laundering, and make
relevant individuals aware of the procedures
. I Verify the identity of new clients and maintain evidence of identification
! Maintain records of client identification, and any transactions undertaken for or with the
client
. Report suspicions of money laundering
Records of client identification and transactions also need to be maintained for few years.
14.7.4 Client confidentiality in relation to money laundering
An accountant should disclose confidential information without client consent in certain
circumstances. In order to disclose confidential information, the accountant must have
knowledge or suspicion, or reasonable grounds for knowledge or suspicion, that a person has
committed a money laundering offence.
Disclosure without reasonable grounds for knowledge or suspicion will increase the risk of a
business or an individual being open to an action for breach of confidentiality.
| 4.7.5 Punishment for Money Laundering
lf any person is engaged in Money Laundering in any way he will be regarded as a person who has
committed a crime and the concerned accused for that crime will be sentenced to imprisonment
for at least a period of six months and a maximum of seven years and will be fined for an amount
not exceeding double the amount involved in the crime.

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Study Manual
Taxation I
SAMPLE PAPER
This sample Knowledge level examination is representative of the style and content of future
examinations at this level.
Marks are indicated at the end of each question.
The Finance Act 2009 rates and allowances will be applied for calculation unless there are other
instructions by subsequent Finance Act.
All references to tax law should be interpreted as references ro lncome Tax Ordinance 1984
and dre Income Tax Rules 1984.
All references to VAT law should be interpreted as references to the Value Added Tax Act l99l
and the Value Added Tax Act 199l.
Unless the question states otherwise, enter numerical values as whole numbers with no decimal
poinc
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14. ethics, ICAB, KL, Study Manual

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14. ethics, ICAB, KL, Study Manual