The responsiblities and purpose of ethics in accounting

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Accounting is more know that related in keeping track of money, both in or out in a company. In a business, accounting in used to monitor the income, expenses, profit and asset for a given period time. It also consider as a language to provide information to an organization in a term of financial information. The main purpose of accounting is to help the users of accounting information to make better economic decisions. Overall, good accounting is a main point to a successful company.

2.0 Accounting Ethics

Every type of profession there must be a guide, for accountant, it is called accounting ethics that refers to the value and professional judgment of while practicing accounting, it not, the rules might be broken in order to please a few parties. Following this ethics is considered to be vital in accounting and applicable to all accountants even the professional accountants. Accounting ethics have already appear since the 1400s but many of the accounting ethics issues are still the same even if the financial in our current time is more strict compare to the accounting century ago.

Users of accounting also relied on each accountant's integrity while completing their work and did not limit it to their skill, efficient and ability. This is because it relies on their competency to make decisions and process it involves by the ethics that they hold to.

In order to keep the standard in accountant, the professionals from the accounting department have created a code of ethics for guidance to all accountants. The code of ethics is needed so that the accounting professional will comply the quality of self-discipline in them so that they will be able to spread far from the legal precincts. No matter if the accountant is in a public or private sectors, the standard that have been designed are for accountant behavior in completing their work which must be consistent and ethical. There is an agreement that comply with the codes of ethics in order to get their title as a certified accountant and if they failed to do so their certification can be striped.

Although if the professional accountant already a member in a professional accounting organization such as Institute of Management Accountant (IMA), Institute of Internal Auditors (IIA) and Certified Internal Auditor (CIA), they are still bound to follow the ethics code. The accounting ethics are very important so that the objectivity and integrity of the profession will be well reserved, and considered as responsibility for them to hold so that the users will not lose their trust and confident to this noble profession.

3.0 Codes of Ethics

3.1 Ethics Responsibilities

There are many people or bodies that rely on the integrity and objective of accountant to maintain the function of commerce such as the clients, government, employer, investor and many others. There are four types of ethics codes that are applied for the accounting professional responsibility and that are competence, confidentially, integrity and objective. All accountants must always carry the responsibility with care and diligence. (IIA Code of Ethics)

3.1.1 Competence

Competence is an ability or skill that able to perform a work in a efficient time. The reason for competence in accounting is that the accountant able to maintain the professional level in developing their knowledge and skills. Not only that, the accountant must perform their duties according to the laws, regulation and standards, so this means bribes or cheat is not an option. Therefore, complete and clear reports are important that also included the source that the accountant gets after the analysis.

3.1.2 Confidentially

As we all know, confidentially are very important in a professional that included the clients' personal information no matter if its neither personal nor financial information. There fore, it is very ethical for accountant the financial information about some company that they work with. This is because if the company is having a part performance, the company might lose their potential investors. They have the right to remain private for their company advantages. Accountant must not use the financial information that acquired during their line of work for personal or other parties advantages.

3.1.3 Integrity

Integrity needed to keep the accounting profession in a morally way. The accountant must avoid the conflict of interest between their clients, for example, both clients are seeking advice on tax regarding prospective transaction between them. This means the client have a competing interest with each other that could render the relationship incompatible. It is not professional and ethical for the accountant to accept gift, favor, or hospitality that could appear to influence their actions. Integrity also includes refraining from engaging any activities that could affect their ability to carry their duties ethically.

3.1.4 Objectivity

In objectivity all the accountants have to do is communicate the information fairly and objectively, which means they only do what the client desire and then disclosed any relevant information that could influence user's understanding of the reports, comments or recommendation that have been presented.(Jennifer Burns)

3.2 Independence

Independence is a term used in accounting ethics that means the accountant must not being influence by biased and being neutral with their client or another party while performing their duties. The attest function include that there are no family relationship between the accountant and the client's executives, the accountant have no interest in term of financial with the company, and the fees is must based on the type of audit opinion rendered. (Answers Corporation)

3.3 Ethics Enforcement

Every accounting organization has before enforced the codes of ethics with their employee. If the accountants have violated the ethics standards, he may be expelled from the organizations. It is very important to maintain a good accounting behavior. To do so, a strong disciplinary measure is complied. (IIA Code of Ethics)

4.0 Purpose of Accounting Ethics

Accounting scandals have being spreading in every company specially the big company which has cause a negative view to accounting profession. It may not see to affect the business of some company but it might have a small effect to the economic. Accounting ethics able to help to encourage a noble and professional behavior towards in creating accounting analysis and enable them to go further in their career with the knowledge of what is right and wrong. Without it, fraud, which means management hide the actual problems from the public view. (Jane B. Romal)

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