Review of Ethics
Review of Accounting Ethics
Nikholas Martin
Dr. Bell
ACC 557: Financial Accounting
Tuesday, 22 January 2013
Review of Accounting Ethics
Accounting profession requires a lot of skills and ethical knowledge. This is because there are numerous temptations that accountants face such as pressures to satisfy investors or to maintain an upward revenue growth (McPhail & Walters, 2009). As such, ethics are essential since accountants who maintain ethical behaviours are able to develop inner strength. This helps them to make ethical decisions which will ensure that a firm prospers in the long run. A professional accountant is expected to possess various principles. These principles include objectivity, integrity, professional behaviour, confidentiality, and professional competence (Jeffrey, 2012). This paper discusses whether the current business and regulatory environment is conducive for ethical behaviour. In addition, this paper not only talks about the Enron Corporation accounting ethical breach and its repercussions but also how Enron Corporation scandals were detected. Further, this paper gives recommendations on measures that could have been taken to prevent the scandals.
Firms operate in a dynamic environment that keeps changing from time to time. Nevertheless, each and every firm must establish an ethical code of conduct that must be followed to the later. Firms have different departments which should operate within given policies and regulations. The accounting department is not an exception to this. In fact, people only have confidence in accountants who conduct themselves ethically and those who are able to make appropriate decisions when faced by an ethical issue. Ethical issues arise in various ways. For instance, a fellow accountant withholding firms` funds for personal use amounts to an ethical issue (Gledhill, 2008). Inflating firms` profits also amounts to an ethical issue. Most firms try their best to ensure the existing business and
Nikholas Martin
Dr. Bell
ACC 557: Financial Accounting
Tuesday, 22 January 2013
Review of Accounting Ethics
Accounting profession requires a lot of skills and ethical knowledge. This is because there are numerous temptations that accountants face such as pressures to satisfy investors or to maintain an upward revenue growth (McPhail & Walters, 2009). As such, ethics are essential since accountants who maintain ethical behaviours are able to develop inner strength. This helps them to make ethical decisions which will ensure that a firm prospers in the long run. A professional accountant is expected to possess various principles. These principles include objectivity, integrity, professional behaviour, confidentiality, and professional competence (Jeffrey, 2012). This paper discusses whether the current business and regulatory environment is conducive for ethical behaviour. In addition, this paper not only talks about the Enron Corporation accounting ethical breach and its repercussions but also how Enron Corporation scandals were detected. Further, this paper gives recommendations on measures that could have been taken to prevent the scandals.
Firms operate in a dynamic environment that keeps changing from time to time. Nevertheless, each and every firm must establish an ethical code of conduct that must be followed to the later. Firms have different departments which should operate within given policies and regulations. The accounting department is not an exception to this. In fact, people only have confidence in accountants who conduct themselves ethically and those who are able to make appropriate decisions when faced by an ethical issue. Ethical issues arise in various ways. For instance, a fellow accountant withholding firms` funds for personal use amounts to an ethical issue (Gledhill, 2008). Inflating firms` profits also amounts to an ethical issue. Most firms try their best to ensure the existing business and
References: Bauer, A. (2009). The Enron Scandal and the Sarbanes-Oxley-Act (Illustrated ed.). Santa Cruz: GRIN Verlag. Gledhill, J. (2008). Corporate Scandal: Global Corporatism Against Society (Revised ed.). New York: Berghahn Books. Jeffrey, C. (2012). Research on Professional Responsibility and Ethics in Accounting (Illustrated ed.). England: Emerald Group Publishing. McPhail, K., & Walters, D. (2009). Accounting and Business Ethics: An Introduction (Illustrated ed.). London: Taylor & Francis.