Not only does the role of sustainability reporting depend on societal expectations, but stakeholder reactions also exert a substantial influence on what management considers is sufficiently important to be accounted for.
Numbers — or rather, financial data — are only as truthful and clear as finance professionals interpret and report them to be. Such is the conundrum of accounting ethics.
Accounting ethics involving conflicts of interest Suppose you are providing services to both a vendor and a purchaser. Or maybe you are consulting a client looking to acquire another client. Or, perhaps, you are faced with two clients, both eager to take over the same company. When it comes to conflicts of interest, or even the appearance of one, you have to ensure they will not adversely or inappropriately sway your business judgments.
To navigate such situations, you might create distinct accounting teams for different clients and notify all parties of the nature of the conflict. Subscribe to the Robert Half Newsletter. Predicaments with client confidentiality Full disclosure might seem like a noble effort, but by offering it, you may run the risk of breaching client confidentiality, e.
Should you find yourself in such a thorny quandary, your best bet would probably be to recuse yourself from involvement in the takeover. Impacts of financial reporting This is perhaps the most common area in which ethics in accounting come into play.
A common question you may ask yourself is: It can mean the difference between one department showing a profit, another showing a loss.
It can even impact stock prices. Sure, legal statutes are a good guide, but many laws have loopholes. Is it ethical to take advantage of them, say, by moving around numbers to meet certain revenue criteria? When confronted with such dilemmas, an accountant needs to have the wherewithal to make difficult yet principled decisions.
Identify potential legal issues Explore whether the issue is regulated by law or policy.
The source for information could be your employer, your professional association, a governmental regulatory body such as the U. Securities and Exchange Commission — or all of the above. Or consider how you would feel if you were an outsider who read about the issue online or heard about it from a friend or family member.
Sometimes, separating the issue from your personal and professional feelings can help you see it in a different light.
Remember that the failure to do something, such as not reporting fraud, can have just as much of an effect as if you yourself were the perpetrator.
If your employer does not have a code of ethics and standards, you and your team should advocate for one. An effective protocol will not provide a solution for every scenario, but it will act as a guide for the decision-making process. When creating a code of ethics from scratch, include guidelines on acceptable behavior, examples of ethical dilemmas and solutions, implementation and cost details, and the consequences for misconduct.
It can be tempting to lie low and not make waves when confronted with ethical issues in accounting. However, you owe it to your career, your profession and to society to act on violations you may discover instead of being complicit in fraudulent activities.
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ETH Inspiring Minds/ashio-midori.com ETH Week 1 Individual Assignment AICPA Code of Professional Conduct For more course tutorials visit ashio-midori.com Write a to word paper describing the purpose of the AICPA Code of Professional Conduct and why it is considered the foundation of ethical reasoning in accounting.
The AICPA Code of Conduct is based on six principles; (1) responsibilities (2) serve the public interest (3) integrity (4) objectivity and independence (5) due care and (6) scope and nature of services. These principles are required practices for all certified public accountants who are members of the AICPA%(47).
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We offer UOP individual assignment help services by learned professionals. Best help is pr. AICPA RULES OF PROFESSIONAL CONDUCT 1 AICPA Rules of Professional Conduct Team B ETH/ Matthew Homa University of Phoenix July 13, AICPA Rules of Professional Conduct The American Institute of Certified Public Accountants (AICPA) as well as the Institute of Management Accountants (IMA) sets a professional code of conduct for accountants.