The Importance Of Ethics In Accounting: Maintaining Trust And Professionalism, Essay.

The Role of Ethics in Professional Development

Question:

Discuss About The Management Approach Stakeholder And Issues?

As said by Albert Schweitzer, “Ethics is the activity of man directed to secure the inner perfection of his own personality”. Ethics is one of those important factors that set the foundation of a well-developed leader (Tai and Chuang 2014). The term refers to a system of the moral principles, which governs an appropriate conduct for a person or a group of person (Trevino, Linda and Katherine 2016). It deals with an individual’s character and the moral rules that governs him and sets limit to his overall conduct. It is something that investigates the questions about the right and wrong, duties and obligations, justice and injustice, fairness and unfairness and the other values, which should guide an individual. Similarly, adherence to a careful of ethical guidelines is one of the important traits of a leader or professional. This essay will elaborate on the answer to the question that, whether or not a accountant need to be ethical. 

No matter is the profession, an individual belongs to, good ethics is an extremely vital part of work and it is a key requirement of every profession (Crane and Matten 2016). Every success or the results that is expected is directly or indirectly related to how the worker deals with the very situation. If the situations are handled ethically then there is a high chances of positive result for the growth and further development. It is also fundamental to prosperity of the business as well. Maintaining a good ethics is being constant with the ethics of accurate moral conduct continually (Butterworth 2014). It not only leads to operate the business prosperously but with the same, it also serves numerous other ways for the development and growth of the same by conveying a sound impression about the organization or business in the market. A company aspires continuously in order to be tracking of its goal during profiting the employees for developing up their foremost proficiency. In this process, the adhesion to a high ethical standard of the staffs or the employees could be very much conducive to the splendid success of the business goals that are being disclosed as deliberated.  The term ethics concerns to the human conduct for making judgments in between the rights and the wrongs (Weiss 2014). There are several different factors that have the potential to encourage an individual to adopt the unethical behaviors in their work place. Still, the right person is the person who, notwithstanding of facing various ethical dilemmas, evaluates the situation and makes the distinction in between the thing that is morally good and the thing that is morally bad so that to emanate the codes and rules of professional conduct. A good ethics leads to acquire the trust of the superiors and promotes integrity that means to carry on doing the things that are right even when they are not watched (Peus et al. 2015). Ethics is highly important in every professional life, and it can be evidence by a huge number of instances and scandals that showed failure of the business, and it might be rightly said that those circumstances would not have been so inflamed if there has been scrutiny of the ethical standards (Ciulla 2014). Hence, preserving the ethical standards in the profession is necessary for the success of the firm as well as one’s own overall personality (Burgess 2016).

The Importance of Ethics in Accounting

The accountants deal with intimate financial and personal details of an individuals or organization (Fields 2016). Some assists with safeguarding the retirement funds of the social workers or the cab drivers while some have the ability to carry out millions and millions of dollar transactions. Hence, ethical codes are the key principles that an accountant choose to comply with in order to enhance his profession, demonstrate his fairness and honesty and to maintain the public trust (Hammersley 2015). Appropriate ethics as well as ethical behavior are highly important in the accounting sector numerous reasons. Firstly, the accountants are frequently privy to sensitive and confidential information, such as bank account details and social security that are related to their clients. This gives the accountants a nice deal of power concerning their clients and customers and it is also important to ensure that the faith and belief in between the clients and the accountants is not abused in any way (Gupta 2014). Similarly, it is also important that the respective organization or the industry does not become condemned as an unethical organization (industry), which is something that has the potential to harm the business of all the accounting companies. Poor ethics in accounting may lead to many negative consequences. The very first is usually a lag in the business. The accounting companies heavily depend on the word-of-mouth for their promotion and therefore, it is very easy for the few bad unethical stories about the companies to sweep away the prospective clients from these firms (Tracy 2016). In addition that, there can be serious legal consequences for the firms that are found to be breaching the legal codes or standards for their jurisdiction. However, sadly, not very accountant is trustworthy. Regular violation of the private as well public trust takes place and resolving those ethical dilemmas not always end favorably. Integrity, Independence, confidentiality, professional competence and professional behavior are the five important areas, which deserve the attention of everyone who are considering working in the accounting field (Soltani and Maupetit 2015).

Good ethics and independence goes hand in hand in the profession of accounting. One of the critical components of trust is building unbiased recommendations and decisions that will benefit the clients. Benefiting the clients from the sale of a financial product that is over another may result in bias, which skews the financial advice to the client. Along with this, demonstrating integrity refers to being straightforward in every business and the professional relationships. Endorsing integrity needs that the accountants do not relate themselves with the information, which they doubt is significantly misleading or false. With the same, revealing or disclosing the financial information of the clients by an accountant and that too without expressing the client’s permission breaches the trust of the customers, which is said to be the foundation of a professional relationship, until and unless there is a professional or legal reason to do so. In addition to these, the legislation, technology and best practices change with the time. Like, for example, the accounting legislation of Germany is governed by the “tax law”, in Sweden, it is governed by the “accounting law”, whereas in the United Kingdom, the same is done by the “company law” (Begg and Henning 2016). Also, there are several countries, which have their own personal organization that regulates accounting. Therefore, a professional accountant must also remain updated. In order to practice the sound judgment, the accountants should always stay abeam of the developments, which may affect the outcome of the outcome. He must also ensure that his subordinates receive accurate trainings and guidance while he carry out his responsibilities. Ethical behavior requires the accounting professionals to obey with the rules or laws and regulations, which governs their jurisdiction and their conduct of work. Eluding the actions, which could unsupportively affect the goodwill and reputations of the entire profession, is a sensible commitment that the business partners and the others should expect.

Maintaining Trust and Professionalism

Finance and accounting could be said as the lifeline of the companies. Every company is formed with one common goal and that is to make money. Therefore, finance and the proper recording of the transactions that are made is something that keeps each of the companies going. The nature of work that is carried out by the accountants needs high ethical levels. The shareholders or potential shareholders or the other users of financial statements depends heavily on the company’s annual financial statements, since they use these information in order to make informed decisions about the investment (Collier 2015). They depend on the accountant who made the statements and the auditors who have verified it in order to present a fair and true view of the organization (Knechel and Salterio 2016). The knowledge of ethics has the potential to help an accountant to overcome every ethical dilemma in his professional life.

Conclusion

From the above discussion, it is clear that ethics plays a very important role in every aspect of life and a good ethics in professional life will lead an individual to maintain his honest image in the organization as well as in society. Whether it is a profession of a doctor, engineer or an accountant, ethics does play a vital role in each professional career. The job of an accountant I to secure every confidential information of his clients starting from their financial details to social information. Hence, they do need to be ethically fair in their professional field. Although, maintaining ethical behavior in the workplace sometime may not assist the organization but will surely serve the public who depends on the accountant’s reporting.

References

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