Rule 204: Harmonized rule of professional conduct

Rule 204 sets out the profession’s standards and the requirements Chartered Professional Accountants (CPAs) must uphold to maintain their independence in any audit and assurance engagement.

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As of November 2013, mark-up versions are available (see the final section on this page) to assist readers in identifying the amendments to Rule 204. The mark-up versions show the most recently approved changes as compared to the preceding harmonized version.

Sections of Rule 204

  • definition of independence in assurance and specified auditing procedures engagements
  • identification of threats and safeguards
  • documentation required for a decision to accept or continue an engagement after a threat to independence is identified
  • specific prohibitions that members and firms shall comply with across a range of situations where independence is threatened
  • required procedures for members to disclose prohibited interests and relationships
  • obligations and procedures for firms, partners and professional employees to ensure compliance
  • maintenance of independence in insolvency engagements
  • disclosure of impaired independence
  • requirements and processes when a member or firm has breached an independence requirement
  • audits under elections legislation

Application of Rule 204 in different Canadian jurisdictions 

The extent to which Rule 204 is adopted by individual provincial bodies and CPA Bermuda is determined by those bodies. 

While principles of Rule 204 have generally been adopted across Canada and Bermuda, there may be some specific differences in some jurisdictions. Please refer to the Code or Rules of Professional Conduct as adopted by each provincial body.

Ordre des comptables professionnels agréés du Québec (CPA Québec)

In Quebec, section 36.4 of the Code of Ethics of Chartered Professional Accountants refers to the independence standards provided for in Rule 204 of the CPA Code of Professional Conduct (Rule 204 on independence). This dynamic reference means that Rule 204 on independence, a rule of professional conduct, is an integral part of Quebec’s Code of Ethics of Chartered Professional Accountants, and applies to all members of the Order once adopted by CPA Canada’s Public Trust Committee (PTC).

Previous versions of Rule 204 — harmonized rule of professional conduct

Harmonized rule of professional conduct

Council interpretations

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