The Importance of Ethics in Accounting Profession

The Importance of Ethics in Accounting Profession

In this entire world, people especially educated ones should be maintaining good conducts and acting ethically accordance with laws and their particular environments indeed. As we are Muslims, we are also brightly encouraged to behave morally and should be appropriate with hadits and al-quran which are being as our guide books in this life.

Before we enter thoroughly to the specific subject, I would like to explain briefly what ethics is. Ethics is the belief system that navigates us to distinguish right over wrong. It is something that we develop over our lifetimes and serves to help us identify good and bad behavior. Ethics is really affecting human activities and their daily lives, that's why ethics plays a pivotal rule in not only our workplace but also our society where we live currently at.

First of all, Accounting is the mechanism that offers information regarding the financial position of the organization or business. This type of information is critical to Investors because it provides them with important and detailed information that could turn out to be the determining factor as to their decisions to invest or not to invest in a particular organization or company. Accounting is teaching us about being trusted and useful in every aspect of reporting, analyzing, decision making, auditing, and other activities which are apparently close to the accounting acts. It is also strongly agreed that the ethical behaviors are not only being implemented in our profession but also in our daily lives. We as professional accountants need to perform ethically.

Accountants are potentially become a supervisor, a manager, an auditor or even a boss in the big company. When they are to be in that carrier, they should act politely and try to emerge the positive influence to their surroundings, so that their employee could reflect and bring themselves to be good as they are. They also should become role models or be great managers in order to make their workers and employees work accordance with ethical instruments. This ethical deed is extremely important because managers naturally always expect and hope that their company should perform well and far greater than their competitors.

Besides that, in manufacturing company, for example, accountants could not Misuse of business funds because it is unethical to misuse them. This activity can lead to the closure of the business and finally will bring to the loss of jobs and investments. Accountants should never misuse business funds and if they use it for the purpose of the company, they should report it in the books of accounts and debited clearly. Creating the false information on expenses purposely is unethical as well. In accounting profession, the accountants should always provide the correct information regarding any expenses and revenue especially because they shape the profit and loss reports of the business and consequently also affect the performance of the business in the long run.

In audit firm, accountants have to behave ethically in reporting and analyzing the company activities. They have to complete their works timely and accurately. For example accountants cannot deceive the company's director just because of one pleasure. Many negative consequences can result from unethical practices. Audit firms rely heavily on word-of-mouth for promotion, and it's all too easy for a few bad stories about unethical behavior to sway prospective clients away from a particular firm. There can also be serious legal repercussions for those who are found to be violating legal codes and standards for their jurisdiction.

In Consultant Company, how accountants treat the clients are the most essential things. They should treat them well and graciously so customers could be friendlier to us. This manner will grow their company indirectly. Clients and customers can turn to say to another their friends or family members and tell them that our company is superior in providing services. This activity will make their business wider and bring more profit for the future of the business. Occasionally, they are in one group of discussing also having some problem and unethical issues. If they have enough knowledge and insight about ethics for dealing with the situation, they could mitigate and solve the conflict or dilemmas easily. Yet, how if they don't know about it, all accountants don't know how to settle problems within their own team? Undoubtedly, the relationship between both parties will become worse and consequently it will affect the overall group outcome.

As I mentioned before, all accountants need to operate ethically because they have to carry the good behaviors and also indicate that they are the educated people. Ethics in accounting is generally covering about confidentiality, credibility, disciplinary and ethics while we conduct a decision. I will describe one by one in terms of the importance of them.

Confidentiality

Confidentiality is about keeping the secret of the company or firm from public and external parties. This is also a part of ethics that accountants need to fulfill. Confidentiality is very important because a big company usually has the secret which is covered and saved from competitor's hands. If the secured secret is shown up willingly by accountants or disclosed by accountants to the public, the company unfortunately will find the huge problems and dilemmas. It is also not impossible that the company will shut down just because of this unethical act. That's why professional accountants must