Ethics is accounting is considered as one of the most fundamental concern in the world of trade. Accounting consists of accounting services and it is regarded as one of the jobs, which is based on disciplines across the world. This profession or ethics is defined in a set of spiritual values and principles (Ghahramani, Soleymanpor and Fatahi 2016). If accountants and auditors are working in the business are not reliant on professional ethics, it has harmful impact on those trusting them. Hence, accounting professional ethics is highly important for accountants and those involved in the work of accounting.
The current study represents that professional ethics is necessary for accounting job. The function and responsibility of professional accountants to the community, capital holders and other individuals are required that they scrutinize all the universal principles of good ethics in all the aspects and resort to the specialized performance regulations to attain acceptance.
The explanation of ethics is wide and there is no widespread harmony however in ordinary sense ethics is defined as the methodical study of conduct that is based on the moral principles and standard of judging right or wrong. Ethical behaviour from the professional standpoint consists of making decisions based on the consequences of alternative actions (Ghahramani, Soleymanpor and Fatahi 2016). The article clearly highlights that as the professional accountants are more and more facing hard challenges in both trade and professional surroundings the force for improved ethical behaviour is growing in the business environment. The article clearly highlights that the accounting profession serves the interest of public and the professional accountant must understand what is anticipated of them to respond efficiently in future.
Accounting codes of professional conduct considerably creates an impact on the behaviour and judgement of the accountants. Ethics and moral dilemmas encircle the work of accountant. Numerous accounting firms amend and revise the ethical code to periodically adopt them to the altering, social-economic, business and accounting environments. A large part of these codes contains technical and ethical rules that are designed to help the accountants meet their professional obligations with competence and integrity. The article further highlights that at the start of this century business will witness an immense challenge on the stability of the accounting as the occupation. The challenge revolves around the profession’s need to support the public assurance towards efficiency and ethics. Social concerns regarding accounting ethics in Australia has emphasises on the interface of ethics and professionalism that has stressed on the consequence of self-regulation.
According to several knowledgeable observers, the Australian firms are experiencing an alteration in values that brings profound implications for trade and the occupation of accounting. Certified Public Accountants appear to possess values that are private instead of communally oriented and they do not seemed to stress on the value characteristics of current society.
Finance and Accounts is the only business functions that accepts responsibility to act in favour of the public interest. Therefore, finance and accounting profession is not limited to meet the needs of any particular individual or organization. It becomes necessary that the finance and accounting professional must comply to certain basic ethics to achieve their objective. Of late, numerous surveys performed globally had ranked the accounting professionals very high in terms of the professional ethics. The article in light of the numerous corporate scandals it is important to create a resonance ethical environment in any organization. The article by Ghahramani, Soleymanpor and Fatahi (2016), states that ethical organizations must have the policies of training and motivating employees towards ethical behaviour.
A number of companies in Australia are known for their quality and soundness of the ethical programmes. Therefore, they ensure that the creating an ethical environment within the organization helps in ensuring the employees are aware of their legal and ethical responsibilities. The article states that facilitating the system of communication amid the management and the employees helps an individual in the company to report about fraud and unprofessional conduct without the fear of being reprimanded. According to Ghahramani, Soleymanpor and Fatahi (2017) ethical organizations should provide the facilities for the employees with the help of which they can communicate with responsibility regarding frauds, unprofessional conduct and other kind of non-detrimental behaviour.
Ethics is a subject, which is inclusive in all the aspects of the human life. The increasing human and social relationships become more complex and create new needs. With the emergence of professions, efforts in response to the requirements and conditions keeps changing over the time as they slowly shape the evolution and development of the valley. As stated by Gaynor et al. (2015) professional accountancy bodies in several countries aims to protect the interest of the public by enabling the accountant to adhere with the professional ethics. Professional behaviour have made their attempt to formulate the regulations however professional conduct regulations cannot alone solve the problems of profession of accounting scandals.
The articles consider the moral and ethical paradigm of a professional accountant to account for fair and objective information in ethical decision-making. As accounting is a great feature that requires expertise, which is dependent on the expertise the outcome is considered as profession. The professional accountants are under obligation to look for the interest of the customers. Considering the profession, the quality of service offered by the professional accountant must possess the confidence in maintaining public assurance. The article has specifically stated that professional accountants must offer their service at a level that is worthy of trust in the community.
The article of Bakhtiari and Azimifar (2013) states that accountants have the obligations towards shareholders, creditors, employees, suppliers, the government, the profession of accounting and the public at large. In other words, the obligations of accountant go beyond the immediate customer. Decisions that are made on the information provided by the professional accountant can materially create an impact on the lives of the above stated stakeholders. Hence, ethical behaviour is necessary and expected trait from the professional accountant. The article of Bakhtiari and Azimifar (2013) reflects that the expectations of the community are very high from the professionals and individuals must have confidence in the profession of accounting by providing quality of complex services.
The information that is provided by accountants must be efficient, reliable, and realistic and should be unbiased. Poor professional ethics are accompanied with qualitative characteristics of financial reporting and can make an unrealistic picture of the financial reporting. Irrespective of the accountant standards and rules without the professional ethics, accountant can manipulate the financial reports. The article successfully highlights that presence of accounting standards and rules does not provides guarantee and sufficient financial reporting. A combination of professional ethics and qualitative characteristics of monetary reporting should be used in developing the professional ethics in accounting profession to promote the quality of financial reporting (Worldwidejournals.com 2017).
The article by Branson, Chen and Anderson (2015) states that ethics in business is presently the most important issue because of sensational corporate scandals that occurred in several countries, which is ultimately damaging to the economy and society. The corporate scandals give rise to the questions of ethics for businesspersons universally and accountants in particular. The article has evidently stated that the accountants are the major contributors in ethical standards of a business enterprise. For accounting and financial professionals it is of vital importance to be ethically discharge their duties because of the varying nature of their profession. The nature of accountants work puts them in a special position of trust in relation to their customers, employers and public as they rely on the professional judgement and guidance in making decisions (Ijbssnet.com 2017).
The accountants are depended upon due to their professional statues and ethical standards. Hence, the professional and ethical conduct is vital in maintaining the confidence of the customers. The article highlights that ascertaining highest ethical standards is vital for a public accountant as well as the business accountant. Public accountants and accounts of business forms the fiduciary relationship, former forms with the customers while the latter forms with employer. Hence, accountants and professionals are anticipated to maintain a level of ethical conduct that goes past the social laws. This has enabled the professional accounting bodies to form a professional conduct to ensure that the accountant behaviour complies with the perceived public anticipations of ethical standards.
The article provides a distinguishing mark of the accountant profession as the acceptance of accountability to act in the favour of public. Hence, a professional accountant’s accountability is not restricted to meet the needs of the clients or employer. Acting in the interest of public, the professional accountants are under obligation to comply with the ethical requirements of this code. The article highlights that a professional accountant is required to adhere with the fundamentals principles of integrity, objectivity, professional competence, confidentiality and professional behaviour.
The article states that functions of professional accountants might come as threats in compliance with the fundamental principles. However, the conceptual framework requires a professional accountant to be familiar with, appraise and address the threats in compliance with the fundamental principles instead of merely complying with the set of specific rules. A professional accountant has the uninterrupted duty of maintaining specialized knowledge and skills at the level to ensure that the clients and employer receives a competent professional service based on the current developments in practice, legislation and techniques (Apesb.org.au 2017).
Conclusion:
The paper focuses on the theory of ethics and its implications on the role of accounting professional. Ethics has turned out to be the most topical issues in accounting and finance currently due to the series of corporate scandals that took place across the world disturbing the credibility of the accounting profession. The study has provided that moral requirements and training of professional accountant can fulfil the role of equitable economic growth.
Apesb.org.au. (2017). Accounting Professional and Ethical Standards Board. [online] Available at: https://www.apesb.org.au/ [Accessed 11 Jul. 2017].
Bakhtiari, M. and Azimifar, M., 2013. Impact of professional ethics on financial reporting quality. Advances in Environmental Biology, 7(10 S1), pp.2862-2867.
Branson, L., Chen, L. and Anderson, L., 2015. THE IMPLEMENTATION OF INTERNATIONAL CODES OF ETHICS AMONG PROFESSIONAL ACCOUNTANTS: DO NATIONAL CULTURAL DIFFERENCES MATTER?. International Journal Of Business & Public Administration, 12(1).
Cibtech.org. (2017). [online] Available at: https://www.cibtech.org/sp.ed/jls/2014/01/00(25).pdf [Accessed 11 Jul. 2017].
Gaynor, G., Janvrin, D.J., Pittman, M., Pevzner, M. and White, L., 2015. Comments of the Standards Committee of the Auditing Section of the American Accounting Association on IESBA Consultation Paper Improving the Structure of the Code of Ethics for Professional Accountants.
Ghahramani, B., Soleymanpor, M. and Fatahi, R., 2016. ETHICS IN ACCOUNTING AND AUDITING. IIOAB JOURNAL, 7, pp.293-299.
Icaiknowledgegateway.org. (2017). [online] Available at: https://www.icaiknowledgegateway.org/littledms/folder1/chapter-12-ethics-in-accounting-and-finance [Accessed 11 Jul. 2017].
Ijbssnet.com. (2017). [online] Available at: https://ijbssnet.com/journals/Vol.%202_No._10;_June_2011/29.pdf [Accessed 11 Jul. 2017].
Researchonline.jcu.edu.au. (2017). [online] Available at: https://researchonline.jcu.edu.au/28964/1/Ethics_Edn.pdf [Accessed 11 Jul. 2017].
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