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More handpicked essays just for you.
How important is it for accountants to uphold ethical standards
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Furthermore, ethical conflict often arises in the workplace and creates ethical dilemmas due to conflicts between personal interest and professional duties. Business professionals are required to balance the conflicting pressures of the corporate world with the need to act with integrity (ATT Ethics, 2013). This means they have to be truthful and honest in their professional duties and they have to benefit without exploiting others. They are challenged to remain professional by protecting the interests of the clients and the public, above considerations of self interest during ethical dilemmas (Duska, Duska & Ragatz, 2011). Accountants have ethical responsibilities to themselves, their clients, their employers, their families and their profession as their profession allows them to maintain a fiduciary relationship with the public (Senarante, 2011). These responsibilities are set out in the codes of conduct and the policies of businesses. The Accounting Professional and Ethical Standards Board (APESB110) addresses the potential ethical conflicting threats that occur in the workplace and the safeguards that can be applied to resolve them. The APES encourages members to act in the public interest and it also establishes a framework that requires members to identify, evaluate and address threats in …show more content…
Business professionals must respect the rights of the customers and employees. Accountants must ensure that their financial statements are accurate and fair to the public. Hence, being just and fair when dealing with ethical dilemmas, is practicing the theory of deontology. However, in the issue where there is evidence of conflicting interests, deontologists have to consider the consequences of the actions, relating back to the theory of
Ethics plays a vital role in developing accurate and high quality financial statements for management, financial institutions, and investors. As management utilizes financial statements to make decisions regarding the operations of the business, it is necessary to review accurate financial statements to make strategic decisions about the future of the organization. Investors and financial institutions require accurate financial statements to make informed decisions upon whether to invest funds into the organization or the wisdom of lending funds to said organization.
Do you agree with Schmeltekopf that business schools are not preparing students well for the for the ethical challenges they will face in the workplace? Why or why not?
This organization has been setting ethical standards and publishing the Code of Professional Conduct for the profession since the early 1900s. A Code of Professional Conduct is necessary for any profession to help maintain strict ethical standards. This organization is the basis of ethical reasoning in the accounting profession because of what the Code of Professional Conduct covers. The code is comprised of a preamble and six articles. The preamble and the six articles serve as a foundation to provide guidance and guidelines for accountants to overcome any emerging ethical issues with ease on a daily basis. The six articles’ purpose is to protect the public, investors, and creditors. The AICPA Code of Professional Conduct consists of: Responsibility, Public Interest, Integrity, Objectivity and Independence, Due Care, and Scope and Nature of
With every business activity come opportunities for fraudulent behavior which leads to a greater demand for auditors with unscathed ethics. Nowadays, auditors are faced with a multitude of ethical issues, and it is even more problematic when the auditors fail to adhere to the standards of professional conducts as prescribed by the American Institute of Certified Public Accountants (AICPA). The objective of this paper is to analyze the auditors’ compliance with the code of professional conduct in the way it relates to the effectiveness of their audits.
Ethics in business is a highly important concept, as it can affect a company’s profits, salaries paid to employees and CEOs, and public opinion, among many other aspects of a business. Ethics can be enforced by company policies and guidelines, set a precedent when a company is faced with an important decision, and are also evolving thanks to new technology and situations that arise due to technology usage. Businesses have a duty to maintain their ethical responsibilities and also to help their employees enforce these responsibilities in and out of the workplace. However, ethics and the foundation for them are not always black and white. There are many different ethical theories, however Utilitarianism, Kant’s Deontological ethics, and Virtue ethics are three of the most well known theories in existence. Each theory is distinct in that it has a different quality used to determine ethicality and allows for a person to choose which system of ethics works best with both the situation and his or her personal ethical preferences.
Ethical issues in business arise because of conflicts between an individuals personal moral philosophies and values and values or attitudes of organization in which a person works and a society in which one lives. Ethical issues can be identified in terms of the major participants and functions of business. Ethical issues related to ownership include conflicts between manager’s duties to the owners and their own interests, also separation of ownership and control of business. Financial issue includes, for example, the accuracy of reported financial documents. Ethical issues can acquire between manages and employees, then employees are asked to carry out assignments they consider unethical. Consumers and marketing issues are related to providing safe desired products for a fear price and not harming people and an environment. Accountants also face ethical dilemma, they have to deal with competition advertising commission. All of this places the accounting profession in situation of ethical risk.
The term “ethical business” is seen, by many people, as an oxymoron. This is because a business’s main objective is to make as much money as possible. Making the most money possible, however, can often lead to unethical actions. Companies like Enron, WorldCom, and Satyam have been the posterchildren for how corporations’ greed lead to unethical practices. In recent times however, companies have been accused of being unethical based on, not how they manage their finances, but on how they treat the society that they operate in. People have started to realize that the damage companies have been doing to the world around them is more impactful and far worse than any financial fraud that these companies might be engaging in. Events like the BP oil
In Module 1, Kindred Todd faced quite a few ethical dilemmas that included her values and technical ineptness. The first predicament was tested her personal morals and ethics. According to, Cumming and Worley, OD practitioners are dealing more and more with value conflicts with powerful outside groups (Cummings & Worley, 2008). Kindred was immediately faced with the issue of knowing what was ethically correct but being told the unethical approach was the best in order to benefit the client and her job security. Although compromising is one of the many skills of organization developers there are still morals that should be followed on each assignment. Kindred, know that deceiving the clients was unethical, took the first step to working on behalf of the client and immediately involved her superior, Larry, to resolve a potential conflict In the project. While her actions went in vain when she told her boss to remove her from the project and provide the client with a more qualified resource, Kindred did what she thought to be the best approach.
Accounting ethics has been difficult to control as accountants and auditors must keep in mind the interest of the public while that they remain employed by the company they are auditing. The accountants should take into account how to best apply accounting standards when company faces issues related financial loss. The role of accountant is crucial to society. They serve as financial reporters to owe their primary constraint to public interest. The information provided is critical in aiding managers, investors and others in making crucial economic decisions. An accountant is responsible for any fraudulent financial reporting. Some examples of fraudulent reporting are:
Many ethical dilemmas are philosophical in nature, an ethical issue can be described as a problem with no clear resolution. In order to solve the issue or dilemma a consensus between the parties involved must be reached. There are several reasons to come to an agreement over an ethical dilemma, it is the basis for all aspects of personal and professional dealings. Each one of us is part of a civilized society and as such it is our responsibility to be rational, honest and loyal in our dealings with others. (Alakavuklar, 2012) states that individuals make decisions for different situations in business life involving various ethical dilemmas. Each time either consciously or unconsciously individuals may follow some ethical approaches
The Facts: Kermit Vandivier works for B.F. Goodrich. His job assignment was to write the qualifying report on the four disk brakes for LTV Aerospace Corporation. LTV purchased aircraft brakes from B.F. Goodrich for the Air Force. Goodrich desperately wanted the contract because it guaranteed a commitment from the Air Force on future brake purchases for the A7D from them, even if they lost money on the initial contract.
Everyone in this world has experienced an ethical dilemma in different situations and this may arise between one or more individuals. Ethical dilemma is a situation where people have to make complex decisions and are influenced based on personal interest, social environment or norms, and religious beliefs (“Strategic Leadership”, n.d.). The leaders and managers in the company should set guidelines to ensure employees are aware and have a better chance to solve and make ethical decisions. Employees are also responsible in understanding their ethical obligations in order to maintain a positive work environment. The purpose of this case study is to identify the dilemma and analyze different decisions to find ways on how a person should act
A deontology perspective involves direct determination that eliminates questionable behaviors, transactions and financial maleficence. Many of the ethical implication Stephen faces are eliminated through a deontological perspective that enables the concentration towards higher standards and other developments beneficial to his organizations. For example, transfer pricing would be approached in accordance to its regulations, bribery and labor issues would be completed eliminated and outsourcing would consider other risk factors besides reducing labor costs. Many of Stephen’s worries would be eliminated allowing Stephen to create a positive organizational culture that focuses on development and morality, which automatically deviates the contrary (Dina,
It is highly essential for accountants and business professionals to maintain a standard of ethical conduct in the workplace as the nature of their work places them in position of trust. (Senarante, 2011). Accountants have the responsibility to ensure that their duties are performed in accordance with the five fundamental principles set out in the Code of Professional Ethics such as integrity, objectivity, professional competence and due care, confidentially and professional behaviour (Cunningham et al. 2014). Accountants are expected to be reliable and trustworthy. Thus they are required to act ethically in relation to their clients, employers and the general public in order to provide quality services in the best interest of the society (Eginiwin & Dike, 2014). The International Federation of Accountants (IFAC) have established a code of ethics for accountants, allowing each specific country to add their own national ethical standards to the code to reflect cultural differences. The code provides emphasis on the five fundamental principles as well as resolution of ethical conflicts. In Australia, professional accounting bodies such as CPA Australia, Institute of Chartered Accountants in Australia (ICCA) and the Institute of Public Accountants (IPA) adopt the Australian Professional and Ethical
Ethics in the Workplace "Ethics are personal and, at the same time, a very public display of your attitudes and beliefs. It is because of ethical beliefs that we humans may act differently in different situations" (University of Phoenix, 2007). Poor ethical choices in the workplace can truly hurt people. Poor ethics can damage their career, happiness, and quality of life. Not only can these actions hurt the individual who has made the bad choices, but also most often it hurts the innocent.