Ethics has become a more central issue in the field of accounting in the past decade, due to the Enron scandal and other similar ethics breaches at large corporations. One of the results of this newfound focus on ethics is the recent rewriting of the Code of Ethics of the American Institute of Certified Public Accountants (AICPA, which is the American national association for certified public accountants), in order to better educate practicing accountants on acceptable practice. Another is a greater interest in how ethics are incorporated into the education of prospective accountants, raising questions such as whether addressing ethics within and across a variety of accounting courses is adequate, or if a separate course devoted entirely to …show more content…
Considering why unethical choices are made aids in creating solutions that will be efficacious; solutions that do not address the root causes of the problem are less likely to result in change. One reason an accountant might not make an ethical decision in a particular circumstance is lack of knowledge; he or she may not know what the ethical choice in that situation is. Another reason an accountant might do something unethical is lack of prudence; he or she may know the ethical actions that should be taken, but choose unethically, either because they are being pressured by others to do so--and perhaps threatened with the loss of significant income or even their job--or simply for his or her own personal or company gain. These underlying roots of breakdowns in ethics are important to keep in mind when thinking of ways to improve ethical …show more content…
On the negative side, these changes reach only new accountants planning to enter the field. On the positive side, the college environment allows for more thorough and in-depth approaches than, for instance, a one-time conference on accounting ethics. Two intriguing approaches to ethical study in accounting are gleaning knowledge from other fields in which ethics is of high importance (Liu, Hao, & Yu, 2012) and applying a religious form of pedagogy to its instruction (Van Hise & Massey,
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.
Ethical decision-making is the responsibility of everyone, regardless of position or level within an organization. Interestingly, the importance of stressing employee awareness, improving decisions, and coming to an ethical resolution are the greatest benefits to most companies in today’s world (Weber, 2015).
Beth Gardner writes about the implications of the 2008 financial crisis as a “trigger” for business schools to teach their students ethics. Ethics is a broad term about moral conduct and how the decisions of an individual affect others. As discussed in class, the three goals of ethics include: preventing harm from occurring, stopping harm from continuing, and minimizing unavoidable harm (Bryan, 6). As witnessed in the 2008 financial crisis, ethics was submerged by the political and selfish nature of corrupt business leaders who focused solely on money.
Parker, L. D. 1955. Practitioner perspectives on personal conduct. In: Cooke, T. and Nobes, C. eds. 1997. The Development of Accounting in an International Context. London: Routledge, pp. 68-89.
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.
Ethical Decision Making It would be wonderful if people were always oriented towards the collective good of everyone. Unfortunately selfish ambitions and conflicting values sometimes drive people to make questionable decisions. Desires for profit, power and political influence can take organizations off course if there is no consideration for ethical principles. Organizations have an opportunity to address concerns of ethical principles by the structure of decision making. This paper will examine some models for ethical decision making.
...6). Enron and Arthur Andersen: The Case of the Crooked E and the Fallen A. Global Perspectives on Accounting Education: Vol. 3: Iss. 1, Article 3. Retrieved from: http://digitalcommons.bryant.edu/gpae/vol3/iss1/3
Making good ethical decisions requires a trained sensitivity to ethical issues and a practiced method for exploring the ethical aspects of a decision and weighing the considerations that should impact our choice of a course of action. Having a method for ethical decision making is absolutely essential. When practiced regularly, the method becomes so familiar that we work through it automatically without consulting the specific steps.
Cost Accounting: Its role and ethical considerations Introduction: Accounting is the process of identifying, measuring, and communicating economic information about an entity for the purpose of making decisions and informed judgements. The major areas of within the accounting are: Financial Accounting, Managerial Accounting/Cost Accounting and Auditing- Public Accounting Managerial accounting is concerned with the use of economic and financial information to plan and control the activities of an entity and to support the management in planning and decision-making process. Cost accounting is the subset of managerial accounting and it helps management in determination and accumulation of product, process or service cost. Role of Cost Accounting: Increased competition and uncertain business conditions have put significant pressure on corporate management to make informed business decisions and maximize their company?s financial performance. In response to this pressure, a range of management accounting tools and techniques has emerged.
Sharland, A., Fiedler, A., & Menon, M. (2013). ETHICS IN THE BUSINESS CURRICULUM: DOES DELIVERY NEED TO BE REVISITED?. Southern Journal of Business & Ethics, 5.
The Decision making framework of professional and occupational ethics has been attained through analytical decision processes used in business. Although these are beneficial, they influence one to assume that moral decisions are already "out there" expecting to be uncovered. In another way, taking a design outlook to ethical decision procedure compels that ethical decisions must be produced,...
As an individual and ambitious accounting student with plans to pursue a career in public accounting, I recognize the importance of understanding my core personal values and behaviors that guide the ethical principles of my everyday actions. I recognize that I have a responsibility to myself, family, future colleagues, future clients, and the general public to follow certain guidelines and conduct myself in an ethical manner. Furthermore, I acknowledge the idea that ethical dilemmas will occur, but I am committed to my “Personal Code of Ethical Values” (as seen above) that represent my desire to live ethically in every facet of my life.
The aim of this paper is to provide the framework of the current professional accounting code of ethics. What are the ethics and how we define them? In this report we try to determine the main ethical principles that will establish the right and
At a glance, accounting might appear as a repetitive cycle of preparing and examining financial statements. However, a brief exposure to accounting has taught me how chaotic it can be for accountants. An accountant captures and represents the information of businesses. By reviewing financial operations, an accountant helps a business run efficiently. This profession can be intellectually stimulating and rewarding. After learning about accounting, I cannot help but be interested and desire to work toward a degree in accountancy. In my studies, I have learned accountants require a plethora of qualities to be successful. And to mature from a student to a professional, I must resolve to strengthen my weaknesses. There is much I must learn and achieve, but a degree in accounting is well worth the time spent.
What does the accountant of the future need to be successful? A sturdy education that while is based on traditional accounting practices, also prepares future accountants for the plethora of changes happening in the accounting universe. Frequently, most of the institutions responsible for educating professionals fail to evolve as rapidly as the professional practice itself (Bedford et al. 4). In every way, accounting is expanding and in order for the future to have competent accountants, accounting education must expand as well. Major changes occurring in the world of accounting include the expansion of services and products, changes in competition, an increase in specialization, and an increase in and an advancement of technology. It is up to academic institutions to find proactive ways in which to prepare students for such changes. Accounting education of the future will require more breadth to cover the inevitable expansion of services and products, increased knowledge of economics, marketing, management and information systems to increase competitive advantage, a balanced course load that provides a general accounting knowledge as well as increased knowledge of a specialization, and also a greater, proactive focus on the use of continuously advancing accounting technologies (Bedford et al. 8). Also in play is the chance of change in accounting standards, the move from US GAAP to IFRS. While there are no certainties surrounding the threat of such change, students in the U.S. should acquire at least a general, basic feel for the practices used in regards to IFRS. The future health of the accounting profession depends, to a great extent, on the health of our students (Gormon and Hargadon 4). Reorganization of curriculums would surely be difficult and assumedly time-consuming, but nevertheless, completely