Ethics Article Review

ETHICS ARTICLE REVIEW

Ethics Article Review

December 27,2006

Since the early 2000s there have been many accounting scandals that have resulted public confidence to decrease in accountants. Due to these scandals the need for ethical awareness has became more important more than ever. The SEC and many other programs have since been implemented to ensure such scandals will be put to a stop.

Accountancy programs have often has wondered how to include ethics into a full curriculum without compromising the technical topics. According to (The CPA Journal) suggests a modular approach. The modular allows ethics alongside the technical course work. The common perception has been that CPAs behave ethically. But unfortunately today there have been many CPAs that have contributed to not acting in an ethical manner. Due to the actions of a few unethical CPAs, ethics put into the accounting curriculums has become more important.

The Association to Advance Collegiate of Business International believes accounting programs need to emphasize ethics above all other business school programs. The modular approach can take up one class period or the entire course depending how the modular approach is structured. Students become aware of ethical standards, framework for ethical dilemmas, and are able to make better ethical decisions. Students also learn following codes in the modular approach:

* Ethical requirements in state and federal laws and regulations

* The AICPA Statements on Standards for tax Services

* IRS Circular 230, the Institute of Management Accountants (IMA) Standards of

Ethical Conduct

* The Financial Executives International (FEI) Professional Ethics

* The Institute of Internal Auditors (UA) Code of Ethics.

The modular approach looks at practical evaluation of ethical dilemmas by use of a user-friendly framework. The user-friendly framework consists of two components. This provides various standards for evaluating alternative solutions. After students learn these standards they are more equipped to be able to approach ethical dilemmas in class and in his or her personal life. The modular approach has been used since 2002 and continues to be refined to infuse more ethics content into the curriculum.

Assigned Readings

This week's readings also further explain and provide examples to the importance of ethics in accounting. According to (Accounting: Concepts & Applications (9th ed.) An increased concern of ethics has been an environment factor affecting accounting. In the early 2000s accounting scandals such as Enron, WorldCom, and Tyco has been a result of upper management falsifying reports. As a result the public confidence in accounting profession has decreased. The SEC has taken action to ensure that the public confidence in accounting is restored. The modular approach as mentioned above could also ensure future accountants more able to make ethical decisions.

Former Organization and Recommendations

I believe the modular approach is a good idea. Not only should this be included with accounting classes but also I believe this should be included as a training program at my former place of employment, which is Maytag. The modular approach could be part of the training program to all new hires at Maytag. The modular approach could benefit in so many other areas of individuals lives besides just in the accounting area.

Importance of Ethics

Ethics is important in individuals' lives as well as in professional lives. Individuals' ethics need to be carried out also within an organization. When an individual's ethical beliefs greatly differ from that of the organization conflicts arise. The same goes also for when there is a difference between the company and the social context in which the company operates. Unethical decisions can have a negative impact on a company and the stakeholders who are included in the corporate culture. Ethics need to be included in all phases of the decision-making process. Accountants especially need to have integrity that is beyond reproach since he or she is the ones producing and monitor financial reports for internal and external use. Ethics is the vital key for companies to survive and profit in today's competitive world ethics is the vital key.

Employees that work in an environment where unethical behavior exists are faced with dealing with the unethical behavior or working somewhere else. Both choices cost the employer. If the employer decides to stay productivity is affected, reduced quality of work performance, absenteeism is higher, and low morale is present.

2002 Sarbanes-Oxley Act

According to (Wikipedia encyclopedia, Sarbanes-Oxley-Act) the Sarbanes-Oxley-Act was passed July 30, 2002. This act was in put