Ethical Issues in Accounting - Free Essay Example

Do you feel there might be an ethical issue present? For the moment, assume that no laws have been broken and only focus on any possible ethical issues.

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There is an ethical issue that is involved in this case, considering that I was not involved in the process of preparing the financial projections. I was not involved in making arrangements for this investigation, meaning that i should not be involved. Company finances are critical to the survival and success of an entity. Therefore, it is an issue that should be handled with a lot of caution, meaning that only the persons that were involved in making the projections should be allowed to engage in the process. The tasks delegated to me after the meeting should only be managed by the persons that were involved in the preparation process.

If you were going to report a suspected ethical issue, how would you do so? For instance, to whom would you report? Would you first discuss the matter with anyone in particular?

When there is a suspected ethical issue when dealing with the financial preparation in this company, I would report to my immediate supervisor so that the right measures can be taken. The supervisor would advise accordingly on what should be done. The matters will be noted by the management team that has the mandate to implement critical changes in the books of account of the firm. However, before reporting to the immediate supervisor, it is essential to discuss with my colleagues to determine if the mistake made is minimal and can be rectified instated of reporting to the supervisor. When discussing with colleagues, it will be possible to highlight the various alternatives that are likely to be taken in managing the ethical issue. It will also present an opportunity to highlight the process of reporting to the supervisor to ensure that the leader manages to get a better understanding of the matter raised. After reporting to the supervisor, I expect the right course of action will be taken. However, if this does not happen, I can report to the seniors for further analysis of the issue at hand. At the time of reporting, it will be essential to gather finds and facts and have a look at the escalation policy. The reporting will be done privately to ensure that the matter is resolved amicably and will not have an effect on the normal running of the organization.

Would the manner in which you respond vary depending on whether this corporation was privately held or publicly traded?

The manner of responding to the ethical issue should not vary depending on whether an entity is private or public. An accountant has an ethical obligation to undertake the duties assigned in the right way, and the actions taken when there is a breach of duty should be the same irrespective of the environment. However, organizations have guidelines that should be followed when whistleblowing, and they should be followed. As an accountant, failing to act whenever there is an unethical issue happening at a company is likely to cause problems in the future. Despite the various procedures that are stipulated by a company on matters relating to the whistleblowing process, a crime committed in a public or a private company will lead to undesirable effects on that business and will require an accountant to respond and report it to the relevant authorities (Alleyne et al., 2017).

Does the fact that you have only been recently hired play into your decisions?

Being hired recently will not affect my decision on whether to report an ethical issue. As an accountant, I have a duty to ensure that the financial operations of a company that I am managing are running in the right way. Any issue that is suspected of having an adverse effect on a company should be reported immediately to ensure that it is rectified. Even if I suspect the problem on my first day in office, I will be worried, and I have to take the necessary actions. Getting fired for doing the right thing should not worry an accounting officer. Failing to report an issue for being hired recently will be like engaging in a crime (Joseph, and Hashmi, 2018). There is a possibility that the high attrition rates of the accountant noted in this company may be due to the unethical activities that are leading the firm to experience financial difficulties. Therefore, the survival of a firm and its expansion process relies on having the right officials and diligent workers handling its various operations.

What possible sources of guidance might be available from a professional organization or your state’s regulatory body overseeing the accounting profession?

Sources of guidance can be obtained from associations that offer assistance on moral issues to professionals in the accounting sector. Companies are registered under various associations that monitor their operations to ensure that these businesses are acting ethically, and the industry is operating in the right way. These associations are essential for they are the ones that offer certification to the organizations that are running under them. Therefore, the professional bodies are useful whenever there is a moral issue that requires more explanations on what should be done when there is unethical activity happening in a firm.

Lastly, assume that you suspect that some state or federal laws may have been broken. In other words, the problems might be beyond just a possible ethical issue. Would this change your handling of the situation?

When it is suspected that federal laws have been broken, the state will be involved, and the right authorities will have to be contacted to take over the case. Therefore, my handling of the situation will not change, and I will have to report to all the relevant bodies based on the laws that have been breached by the company. Therefore, more bodies will be involved in tackling the unethical behaviors happening in this company and the whistleblowing will be necessary to ensure that the operations of this organization are clean. The firm should be operating based on the expected legal guidelines, as stated by the accounting bodies and the state laws.

References

Alleyne, P., Charles-Soverall, W., Broome, T. and Pierce, A. (2017), "Perceptions, predictors and consequences of whistleblowing among accounting employees in Barbados", Meditari Accountancy Research, Vol. 25 No. 2, pp. 241-267. https://doi.org/10.1108/MEDAR-09-2016-0080

Joseph, G. and Hashmi, A. (2018), "Legitimacy and Institutionalization of Code of Conduct: The Management of Business Ethics", Jefrey, C. (Ed.) Research on Professional Responsibility and Ethics in Accounting (Research on Professional Responsibility and Ethics in Accounting, Vol. 21), Emerald Publishing Limited, pp. 53-82. https://doi.org/10.1108/S1574-076520180000021003