In 2012, the Ethics Resource Counsel reported there is a definite correlation between the state of the economy and reported instances of unethical practices in the workplace, with reported instances of unethical behavior rising to 65%. Almost two-thirds of employees in that year reported various ethical violations, including incorrect expense reporting and falsification of financial reporting -- two complaints directly linked to accounting ethics. Accountants are expected to have high ethical standards because they handle money. Unethical accounting behavior poses the risk of severe financial and professional consequences for both the accountant and his client or employer.
Accountants are given a large amount of trust by their clients. Clients and employers trust accountants with very personal financial information. It is imperative that an accountant be able to keep this information confidential. If a client's personal financial information was released it could lead to theft of assets and possible litigation. In order to avoid this type of situation, which would at the least ruin the professional reputation of the accountant, accountants must take steps to safeguard information, including bank account numbers, tax files and social security numbers. Examples of these steps include limiting file access, encrypting computers and servers and refraining from discussing information with co-workers or acquaintances.
One of the larger ethical issues facing accountants is accuracy in reporting. In accounting there is no room for error. Every fact and figure that an accountant presents to his or her client or employer has to be correct and easily verifiable by another accountant. Accountants are charged with having to be completely honest in their positions. The reports generated by accountants are used to make business and financial decisions, supplement tax filings and are reported to shareholders. Accountants ethically cannot change numbers on reports or falsify ledger information.
Ultimately most accountants must hold themselves to the ethical standards they agreed to uphold when they became accountants. An employer or client may put so much trust in the accountant that there is little to no system of checks and balances for the accountant's work. Or accountants may find themselves in a position where an employer or client asks that financial records be altered. In this situation, it would be the employer or client who makes the final decision, but the accountants are under an ethical obligation to not perform tasks that they know to be illegal. Accountant has to set their own ethical and moral standards and hold themselves accountable for their actions.
Ethics, Values and Morals
There are certain personal qualities that clients and employers expect accountants to have. An example of this is personal morals and values. Ethics, morals and values are closely related concepts. There are certain ethical rules that accountants are expected to abide by. If you become a CPA, violation of these ethical rules can result in the loss of your license and/or legal action. Values and morals are your personal beliefs -- the things that you believe are right and wrong and what defines the personal and professional lines that you won't cross. Keep in mind that just because a situation that you encounter as an accountant violates your personal values or morals, it may not be an ethical violation.