Ethical Issues Faced by the Accountancy Profession Essay

Ethics plays an essential and integral part in the accountancy profession. Professional conduct plays an important role in establishing public trust in financial reporting and business practise. Yet this can and has come under threat when clients and employees are exposed to the risk of fraud when accounting ethics are not adhered to. Codes of ethics are adopted to ensure the reliability, comparability and integrity of financial statements. Ethical standards exist to safeguard the fundamental principles of accountancy and recognize threats to these principles so judgement can be made to resolve ethical dilemmas. However an accountant frequently faces ethical issues due to their work and not always stays vigilant to the manipulating†¦show more content†¦In recognizing the importance of ethics to the accounting profession, many colleges and universities have incorporated ethics into the accounting curriculum in recent years to meet industry demands. Somers, M. (2001) found that a growing interest in codes of ethics is evident in organizations over the past few decades. In his article, Somers outlines the influence of codes on employee behaviour in organizations. He states the effects of the growing adoption of codes of ethics in organizations is not being addressed as unethical perceptions and behaviour continue. Somers carried out a survey of a sample of management accountants in the U.S and he found that respondents in organizations with formal codes of ethics were less aware of unethical activity in their organization compared to respondents in organizations without a formal code of ethics. These results indicate that neither the presence of corporate codes of ethics nor a high level of familiarity with the institute of Management Accountants code of ethics had any influence on employee propensity to report observed wrong doing. Somers then surveyed whether or not the respondents had personally observed or obtained direct evidence of financial fraud in the present organization within the last five years. Nearly 56% had observed wrong doing and around 35% ofShow MoreRelatedthe legal ethical and technological conerns paper1087 Words   |  5 Pages The Legal, Ethical, and Technological Concerns Paper For as long as businesses have existed, so has accounting. With time, it has become more complicated and detailed, but it is still a process of keeping financial accounts in order. Through accounting, or financial reporting, a system is set up to keep track of, maintain and audit the financial proceedings. Because accounting and financial reporting of a business is so important for its accuracy and in general, a lot of ethical, technologicalRead MoreEthics : The Principles Of A Culture Individuals, Organisation Or Groups814 Words   |  4 Pagesbe. 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