b.Demonstrate the application of the Code of Ethics for Professional Accountants to a range of ethical issues and problems in accounting and business.
c.Be able to recognize the significance of cultural issues in the resolution of ethical issues.
d. Present solutions to ethical issues orally and in writing.
The current assignment is being produced in order to identify analyse and discuss the various elements of ethical issues. Once the elements have been identified, the assignment will deal with a demonstration of the application of the code of ethics for professional Accountants to deal with a wide spectrum of ethical issue that a professional may face in accounting as well as business. The assignment will also try to recognise the influence and significance of the cultural issues when resolving ethically challenging topics. After conducting an in-depth study, the assignment will try to present solutions to the identified elements of the ethical issues.
Trust and honesty
In a business, trustworthiness as well as honesty are key elements of business-related ethics as it is directly proportional to the client's ability to trust the business organisation. This trust is not only dependent on the ability of the organisation to do quality work in a timely fashion but also depends on the truthfulness and fairness of the business practices that are followed by the organisation (Ferrell & Fraedrich 2015). Commitments made to clients need to be honest and must be fulfilled. Shady business practices do not generate a lot of Reliability among the clients which can be detrimental to the growth of the organisation.
Another crucial element of business ethical issueis confidentiality. Business organisations have a hold on a considerable amount of private information which are related to the client’s business. This is because there is a mutual agreement to work together and hence it is very much necessary to maintain the confidentiality of information. As pointed out by Chell, Spence, Perrini& Harris (2016), the team members and employees are required to strictly adhere to confidentiality policies and clauses which have been highlighted in the contracts. If one business organisation is not able to maintain the confidentiality of information of the partnering organisations, there will be a chance of disruption of the partnership.
Globalisation has led to technological advancement and in turn, technological advancement has led to a simplification of business practices and operations. The Internet is one aspect of technology which is being utilised by Business organisations for obtaining crucial information.While it is necessary to make optimum use of these Technologies it is also necessary to understand that copyright infringement during use of software and Hardware is a very significant element of the ethical issue (Palliam 2018).
Another element of ethical issues is the availability of an environment which is free and non-critical of those who bring forward issues of wrongdoings. According to Fern?ndez & Camacho (2016), it is necessary to perpetuate an environment where the employees can report non-adherence of ethics policy without fearing any retaliation from the board or the management.
Table 1: Key elements of ethical issues
(Source: Crane & Matten 2016)
As the accountant is responsible for dealing with intimate details of financial aspects in the context of a business organisation or individuals it is necessary for them to follow and ethical code of conduct. One such guideline is the code of ethics of professional accountants. The ethical code present in the code of ethics for professional Accountants is fundamental principles in the context of accounting which individuals in the field are supposed to follow and abide (Cameron & O’Leary 2015). This not only enhances the professionalism but also helps in maintaining public trust as they demonstrate reliability, trustworthiness, honesty as well as fairness.
A very important component of the code of ethics of professional Accountants is the Independence and objectivity that is the freedom to make unbiased decisions as well as recommendations that are for the benefit of the client. In case there are conflicts of interest, it is necessary to expose the same in accordance with the guidelines. According to Samsonova-Taddei& Siddiqui (2016), these recommendations cannot be subjected to external influences in order to remain objective as the professional judgement of an accountant is compromised when their judgement is subjugated by another individual’s judgement.
The code of ethics for professional Accountants is also responsible for imbuing a sense of integrity and confidentiality in the work done by accountants. Integrity helps an individual to remain straightforward, objective as well as honest when they are tackling professional relationships which require disassociation from information which can be misleading. Confidentiality is important as disclosure of information that is critical to a business and violates the trust of a client in a professional relationship is not appreciable.
It is the duty of a professional accountant to keep up to date with the changing Technologies, practices and legislations in place which is fundamental for exercising a sound judgement which in turn is responsible for affecting the outcome of a decision. It is also mentioned in the code of ethics for professional Accountants have certain laws and regulations that these professionals need to comply with as it governs the body of the work. Hence it is necessary to avoid actions that can affect the reputation surrounding the profession in a negative manner (West 2018).
The concept of culture is unique, interesting as well as important to an individual however it is very hard to define as well as understand the same. Culture can be considered as a set of meanings that can be utilised by an individual as a blueprint for behaving, thinking and feeling. Culture includes the different patterns of tradition, values, beliefs, expectations as well as symbols (Kao et al. 2016). Culture helps in defining every aspect of human life that cannot be otherwise defined. It is necessary to increase the cultural awareness in order to identify the similarities between cultural issues which can lead to possible resolution of the ethical issues.
Understanding the cultural differences will help in identifying the communication style that can be used for resolving the ethical issues. This will also help in identifying the various attitude that an individual or a group of individuals show towards a conflict of interest. According to Murray & Nash (2017), understanding the cultural issues will also help in formulating different approaches that can be used for tackling the different attitude that is involved ina conflict of interest. On the basis of these different approaches, there exist different styles of decision making which helps in tackling the emotional as well as personal matters of those involved in the conflict.
It is very easy to understand that culture itself has a very significant impact on the perception of ethics. It is necessary to understand that there is a correlation between these two concepts which along with the individualistic perception such as age, religion and sex is responsible for influencing the ethical attitude as well as perception (Carroll &Buchholtz 2014).
In order to workout the ethical issues, it is necessary to understand the basic principle that differentiates right and wrong. In order to minimise the conflict of interest, it is necessary to implement an ethics policy which is in advanced will prepared. In the words of Shaw & Barry (2015), it should be also be kept in mind that in order to handle the ethical issues it is necessary to have a cautious approach towards issues which are potentially illegal or dangerous in nature. In order to present the solutions to ethical problems it is necessary to understand the law, have certain expectations, undergo ethical training as well as having a supervisor who is fair.
It is very necessary to research the several Federal as well as state laws pertaining to ethical issues. It is also important to keep in mind and individuals right to protection and privacy. It is advisable to undertake legal counsel in order to minimise the liability of an organisation under these laws of ethical conduct. Understanding the public policy pertaining to ethical and legal issues is very necessary in order to minimise the chance of legal encumberment.
It is also necessary to develop policies that take encompass the philosophy mission and vision of the organisation or institute in which the ethical issues have developed. This will help in providing a code of conduct to the Employees (Luthans & Doh 2018). Incorporation of these policies into programs managing performance will help in increasing the accountability of employees in terms of their actions and will allow them to uphold the standards of professionalism during their job performance as well as interaction with supervisor or peers.
It is also critical to provide training sessions for enlightening the employees and other people at the workplace of ethical guidelines. This can be done by the utilisation of various methods of instruction for engaging the employees so that they can learn to address as well as resolve ethical issues. In order to effectively supervise the entire processing, it is necessary to put someone inahead of ethics. According to May, Luth &Schwoerer (2014), the policies and guidelines pertaining to ethical issues need to be consistent when they are subjected to workplace ethical issues. The principles that will be used for handling the ethical dilemmas need to be the same irrespective of the seriousness of the issue or the hierarchy involved.
The current assignment was formulated by considering the various elements of ethical issues. Identification of the elements helped in demonstrating the application of ethical code for professional Accountants that itself has been formulated by taking into account varied range of problems that a professional accountant message while performing their duty. The influence and significance of culture-related issues during the resolution of ethical issues have been also discussed which help in providing a solution which can be applied for resolving ethical issues.
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