Assignment 1 Review of Accounting Ethics
Assignment 1 Review of Accounting Ethics
Strayer University
Financial Accounting
ACC 557
May 1, 2013
Assignment 1 Review of Accounting Ethics
Imagine trusting your hard-earned money like your retirement savings to a financial adviser or Certified Public Accountants (CPA) only to lose it all in a fraudulent Ponzi scheme. In today’s world of business many organizations, financial planners and accountants are in the news due to the financial ethical breaches that have affected their customers, employees, and the general public. A CPA has to be responsible for their audits and take any punishments as a result of their mistakes, incompetence or illegal actions. CPAs are expected to have integrity in their work, confidentiality in their findings, honesty in their decisions, and exemplify professional behavior as a part of CPA ethics. There are standards, regulations and codes that must guide professional CPAs in their jobs to insure companies and investors are protected. One of these is the International Ethics Standards Board for Accountants. If and when professional accounting ethics lines are crossed, CPAs may and should accept the fact that they can lose their jobs and their livelihoods. They may also find themselves enjoying some quality time in jail depending on the crime like the auditor in the Bernard Madoff case.
When Bernard Madoff filed false reports and made misleading statements, his accountant David Friehling backed him 100%. This went on for roughly 17 years and $65 billion in stolen funds. It is during that time the Madoff 's Ponzi scheme went unnoticed affecting the lives of many swindled investors. Mr. Madoff’s financier and longtime CPA Mr. Friehling routinely rubber-stamped Mr. Madoff 's cooked books while reaping millions from their illegal so called investments. According to James Clarkson, who is the acting head of the Securities and Exchange Commission 's in the New York office, Mr. Friehling sold his accountant’s
Strayer University
Financial Accounting
ACC 557
May 1, 2013
Assignment 1 Review of Accounting Ethics
Imagine trusting your hard-earned money like your retirement savings to a financial adviser or Certified Public Accountants (CPA) only to lose it all in a fraudulent Ponzi scheme. In today’s world of business many organizations, financial planners and accountants are in the news due to the financial ethical breaches that have affected their customers, employees, and the general public. A CPA has to be responsible for their audits and take any punishments as a result of their mistakes, incompetence or illegal actions. CPAs are expected to have integrity in their work, confidentiality in their findings, honesty in their decisions, and exemplify professional behavior as a part of CPA ethics. There are standards, regulations and codes that must guide professional CPAs in their jobs to insure companies and investors are protected. One of these is the International Ethics Standards Board for Accountants. If and when professional accounting ethics lines are crossed, CPAs may and should accept the fact that they can lose their jobs and their livelihoods. They may also find themselves enjoying some quality time in jail depending on the crime like the auditor in the Bernard Madoff case.
When Bernard Madoff filed false reports and made misleading statements, his accountant David Friehling backed him 100%. This went on for roughly 17 years and $65 billion in stolen funds. It is during that time the Madoff 's Ponzi scheme went unnoticed affecting the lives of many swindled investors. Mr. Madoff’s financier and longtime CPA Mr. Friehling routinely rubber-stamped Mr. Madoff 's cooked books while reaping millions from their illegal so called investments. According to James Clarkson, who is the acting head of the Securities and Exchange Commission 's in the New York office, Mr. Friehling sold his accountant’s
Bibliography: Benner, K. (2008, December 19). How 'd Madoff do it? Why? . Retrieved from money.cnn.com: http://money.cnn.com/2008/12/18/news/six_madoff_questions.fortune/index.htm Marquardt, K. (2008, December 16). 5 Ways to Avoid a Ponzi Scheme: Madoff Edition How not to get caught up in investment fraud. Retrieved from money.usnews.com: http://money.usnews.com/money/articles/2008/12/16/5-ways-to-avoid-a-ponzi-scheme-madoff-edition Massive Orange in Accounting. (2010, July 8). A Breach of Professional Accounting Ethics. Retrieved from bizcovering.com: http://bizcovering.com/accounting/a-breach-of-professional-accounting-ethics/#ixzz2SEkARASD Thomas Zambito, E. S. (2009, March 18). David Friehling, a CPA for Bernard Madoff, charged with securities fraud, surrenders to the FBI. Retrieved from nydailynews.com: http://www.nydailynews.com/news/money/david-friehling-cpa-bernard-madoff-charged-securities-fraud-surrenders-fbi-article-1.368152#ixzz2SEmh12GG Zambito, T. (2009, March 18). David Friehling, Madoff 's Accountant, Surrenders to the FBI. Retrieved from Daily News Staff Writer : http://www.usnews.com/news/national/articles/2009/03/18/david-friehling-madoffs-accountant-surrenders-to-the-fbi