Different situations that might lead to unethical practices in accounting could include misrepresentative financial analysis in order to obtain personal gains, mismanagement of funds, embellishing revenue, purposely providing wrong information in regards to expenses, embellishing the value of corporate assets, purposely providing wrong information in regards to liabilities, bribery, manipulation of financial markets, and lastly inside trading. Although, textbooks, case studies, articles and journals about accounting ethics have been used in accounting education programs, it seems that for developing and promoting ethical thinking, a reengineering in accounting education for identifying and planning ethical behavior based on ethics including humanizing accountants and self regulation in their work environment must be used. Corporate scandals cause the public to question why some people run their businesses honestly and others turn into criminals. Effect of Unethical Behavior In accounting, there are or have been situations that might lead to unethical practices and behavior. Some individual may look at what can be done versus what are legally acceptable accounting principles and behaviors.
This essay will provide some basic ethical guidelines that apply to organizations, why unethical behavior is happening in the workplace, and finally, it will identify ways in which management and organizations can encourage ethical behavior. This may lead to short-term prosperity, but altered financial records will ultimately spell the downfall of companies when the Securities and Exchange Commission discovers the fraud. But how does it impact on accountants if ethical guidelines are not adhered to? In this essay i will include examples of unethical behaviours done by companies, ethical and unethical activities and illustrate it. This behavior is resulted from greed and personal gain. The role of accountants in terms of abiding to the ethics and good corporate governance is not only important for the insiders of an organization but also equally important for the outsiders. Section 302, a mandate which require senior management to certify the accuracy of the reported financial statement. This paper will also examine the effects of the Sarbanes-Oxley Act of 2002 on financial statements.
A South Jersey doctor was convicted in April 2013 of charging Medicare for spending 2. There is so much corruption in business today that the true meaning of ethical behavior has almost been forgotten. In the 1990s, many big companies had misleading and outright fraudulent activity on their account financial statements. An example of this can be management instructing an employee to record a transaction in an incorrect manner. Auditors giving management advice concerning external audits and accounting procedures to manipulate accounting information is another form of unethical behavior James. Another inconsistency is that I have noticed that the supervisors tend to pay men more while women doing the same job get paid less.
Results It was found that the relationship to collaboration played an essential role in. During court proceedings other practices involving HealthSouth were uncovered. The management team of the organizations is also tasked with the responsibility of ensuring quality internal control on the financial statements. Accounting can be best described as a type of tool or language put in place in order to provide appropriate information with regards to the financial position of an organization, corporate or business. The Effects of Greed Greed in the business and finance world leads to shaving ethical boundaries and stepping around safeguards in the name of making more money. The game facilitates student reflective thinking — a learning process where an individual addresses a problem that has many reasonable solutions rather than just one answer. Disconnection Perceptions of reality are determined by daily surroundings.
Thus, institutions and entrepreneurs stand in a symbiotic relationship where each gives feedback to the other. Moreover, the Act provides penalties for offenses related to fabrication, alteration or destruction of evidence linked to fraud offenses Beth, 2010. This was until March 19, 2003, when the Securities and Exchange Commission charged the company and Richard Scrushy with fraudulent account reporting of company finances. Management and auditors must establish internal controls and reporting methods on the adequacy of those controls. Many argue that the implementation and ongoing requirements of Sarbanes Oxley and other laws are costly, time consuming, and as yet ineffective.
Effect of Unethical Behavior Article Analysis Chris May 6, 2013 Acc 291 Judith Vargas University of Phoenix I am going to explain in this paper some situations that might lead to unethical accounting and how we can identify some of the unethical practices in accounting. Authentic people take full and complete ownership for their lives, their choices, thoughts, feelings and actions, without blame or faultfinding. This article traces the evolution of accounting from bookkeeping to professional status and explores the development of the professional bodies that govern the practice of the profession. . If the company does not have internal controls put in place to try and elude unethical behavior it is setting itself up for trouble.
Despite accounting standards and rules, without values and responsibilities, accountants can provide manipulated financial reports. At least it forces the process of identifying and resolving issues. The approach was introduced in managerial and cost accounting courses and has been employed also in an intermediate accounting setting. Situations for unethical behavior Several acts of unethical behavior in organizations are driven by the need for money. Both Companies were involved in scandals that engaged in misrepresentation in financial statements and fraud.
Greed At the root of a complex matter is a very simple fact: Some people enjoy having lots of money and will break the law to get it. Words: 401 - Pages: 2. Collaboration in Operation Management Introduction The concept of behavior management is one which can be tested through both practical and theoretical applications. Therefore the results were the any debts or losses that Enron suffered were not reported on financial statements. I will also examine the effects of the Sarbanes-Oxley Act of 2002 on financial statements.