Accounting in today's Modern world economy is vital profession. Accepting responsibility towards the public is main note of distinguishing in accounting. There are lots of expectations from this profession in community, and people must have confidence in the complex quality of service provided by accounting profession. Therefore the information provided by accountants should be significantly efficient, reliable, factual and disinterested; so, the accountants are not only eligible and professional competent, but also have a high degree of professional integrity and honesty. In addition, the professional reputation is their most important assets. As a result, accounting ethics for professional accountants and for individuals who rely on accounting services is important.
Necessary to achieve the objectives of the accounting profession by the professional accountants, is adherence to ethical principles of accounting. Accounting ethics more or less are the consensus of all the professional associations of accounting and comply with them lead to providing their professional objectives that coming as follows (3,7,4):
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a) Honesty: Professional accountants in performing their professional services must be honest.
b) Neutrality: Professional accountants should be neutral and should not allow any prejudice, bias, conflict of interest or influence of others to undermine his impartiality in offering professional services.
c) Professional Competence and Care: Professional accountants have to do professional service with competence, diligence, and carefully.
d) Confidentiality: Professional accountant should attend the confidentiality of information during their professional services and should not use or disclosure such information without explicit permission employer, unless he has legally or responsibility right for its disclosure.
e) Professional behavior: professional accountant should act in a manner that is consistent with his professional reputation and he refrain the actions that undermine the credibility of the profession.
f) Principles and standards of professional: Professional accountants need to perform professional services in accordance with the principles and standards of professional, and also perform his employer's request so with skill and precision which be consistent with the requirements of integrity, objectivity and independence of the independent professional accountants.
Issues for ethical accounting in today's economy
Focus on the business units to maximize profits, to deal with Competitive challenges, emphasis on short-term results and various services accounting, accountant in an environment filled with conflict and pressure is placed that lead to unethical consequences for them (9, 5, 8,1.3 ).
Focus on the business units to maximize profits: in recent years, large companies for report of higher profits and fool investors have resorted to accounting fraud. Famous companies and top corporate executives and managers have been directors and administrators of such fraud that have led to undermine trade and commerce.
To deal with Competitive challenges: competitive market of today's economic world, despite the benefits and advantages for customers to use products with better quality and lower prices, it also has had many ethical implications for competitorsââ‚¬â„¢ supply of goods and services. Accounting profession in the competitive market for delivering accounting services is more or less faced with ethical dilemmas. Two principles of "independence" (neutral) and "honesty" that must be met in providing accounting services and thereby increase the quality of these services in this market, have been damaged.
Various services accounting: while the primary role of accountants providing a picture of the situation and the financial performance of an organization, they also have other functions such as auditing management accounting, tax accounting, financial planning and financial counseling is performed. Playing all these roles, particularly financial counseling and financial planning has caused accounting profession from a traditional profession, that role was responsible for reporting and audit, move to the direction of entrepreneurship consulting, design and financial planning. Today seems that auditing which is the heart of the accounting profession because of the inaccuracy use of it, from the profession is removed or almost unworkable. While, society requires true and correct Auditing reports. If the report is not useful, one of the big accounting tasks that are the audit is released.
Examples of ethical issues in accounting:
In March 1999, a lawsuit was produced against the Rite Aid Company and its senior managers and employees group which accused them to commit fraud, false and inflated profit reports, violations of generally accepted accounting principles and disclosure of unfavourable information about the company's business operations. However auditors also had failed to disclose the fraud (5).
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In May 1999, the Securities Commission prepared a lawsuit against management of Grace Company due to report numbers to mislead the capital market partners. The commission accused corporate executives of Grace to hiding and storing a portion of unforeseen profits for later use. He claimed that in 1995, the company for reporting their desired profit have used in provision of hidden profit (11).
In January 2000, the New York Times reported that Securities Commission understood that Price Waterhouse and Coopersââ‚¬â„¢ employee and partners, normally has been violated from rules that prohibited ownership of Shares of the companies in the auditing. Reviews showed that there was 8046 violations and dismissal of 5 partners (12).
The exact analysis conducted by the Securities Commission have shown that there is a very high volume of accounting fraud by auditors in auditing companies such as Cendant, Sunbeam , Livent is ignored. As a result, hundreds of millions of dollars of shareholders have been lost by the company's accountants and trust has been tarnished (13).
Suggestion & discussion:
In my opinion, to institutionalize and expand and promote professional ethics in accounting, the role of government, professional associations, accounting firms and other employers of accountants, and the accountants themselves is very important.
To prevent a repeat of the financial scandals in the future, it is important to see how the management and accounting faculties teach tomorrow's leaders. If universities do not teach future managers and accountants about the foundation relationship between society and companies, cannot expect top executives to understand these relationships. Students should take note to honest in business and management, accounting and personal levels, business and community.
Accounting firms and other companies that are hiring accountants to hire accounting staff should be assured of their professional competence and moral responsibility. Likewise, to keep professional responsibility by accountants, big accounting firms have to appoint a senior accountant as an expert in issues related to professional responsibility to respond to problems and assist accountants in moral judgments during the work.
Accountants must also have a personal commitment to educate in the skills of moral judgment.
Government intervention by means of strong tools of punishment for those who violate ethical rules is an effective solution.
Government's duty is only overall legislation and if with presentation of the petition lead to delinquent penalty. But the professional associations are that establish principles and rules of ethics and prediction enforcement of the principles and provisions in the Statute of the professional association play a more important role in gaining and maintaining a professional reputation.
In conclusion, future of accounting profession depends on ethical leadership by professional accountants and their leaders. It is necessary that they explain the importance of high levels ethical standards and training personal honesty needs, present and future accountants move to the noble. It is obvious that, this ensure us that in the future, accounting profession can continue its historical role in the fair development economic, success and welfare of nations.