The Republic's second-largest accountancy body has warned that any breaches in the ethical standards of its members would be met with the severest disciplinary procedures.

At a conferring ceremony for new entrants to the industry, Mr Alan Farrelly, president of the Certified Public Accountants Institute in Ireland, warned that his organisation would vigorously work to protect the reputation of its members.

He said that an accountancy qualification was hard-earned and deserved to be held in the highest regard.

To highlight this, he quoted a 60 per cent failure rate for those who sat final exams for the institute last May.

"The image of the entire profession is all too frequently tarnished by the actions of very few accountants who behave unethically and by breaches of integrity," said Mr Farrelly.

He added that ignorance of ethical responsibilities was no defence and would not be tolerated.

Mr Farrelly also criticised self-regulation in some parts of the accountancy industry because it has been shown to "lack significant teeth, transparency and, in some cases, credibility".

He said his institute welcomed the idea of an independent supervisory authority for the profession because it would indicate the profession's acceptance of its responsibility to act in the public interest.

In February, the Minister for Trade and Commerce introduced a new Bill to put the Irish Auditing and Accounting Supervisory Authority (IAASA) on a statutory basis.

The Companies (Auditing and Accounting) Bill 2003 is before the Oireachtas and is expected to become law before the end of the year.

The principal function of the IAASA under the terms of the new legislation will be to supervise how the prescribed accountancy bodies regulate and monitor their members.