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Ethics consist of moral principles or ways of behaving that benefit society. Some ethical behaviors that you have been taught are summarized in Figure such as trustworthiness, respect, responsibility, fairness, etc.
Unfortunately, some individuals do unethical things. Your text suggests that there are two basic reasons that people behave unethically--either their personal ethics differ from those of society, or they are acting out of greed or selfishness.
Typical rationalizations for such behavior include: Obtain the facts; Examine the effects of various outcomes on each participant; Identify alternatives; Look at the consequences of each alternative; Choose the appropriate action.
An illustration is provided in your text that illustrates this process. Professionals are typically required to hold a high standard of behavior, beyond the legal aspects of the profession.
Often, the CPA is acting on behalf of an unseen public--those individuals and organizations who rely on the fairness of financial statements in making investment and loan decisions.
There are six ethical principles of conduct: While the principles are broad guidelines, the rules of conduct are more specific, and are enforceable. This is implied by the word "rule", as opposed to "principle.
A Summary Table of the Rules of Conduct is shown in Table at the end of the chapter, and addresses issues such as independence, confidentiality, contingent fees, advertising, and forms of organization.
Note also that each rule is numbered and that some rules apply to all AICPA members, while others are for members in public practice only.
Nonaudit services, including prohibition of nine services in those cases where the CPA firm also provides audit services.
Independence must be maintained in fact--the auditor must maintain a balanced, unbiased attitude. But, additionally, the auditor must have the appearance of independence.
Financial interests--the issue is whether a material direct investment by an auditor in an auditee, or indirect investment by a family member of an auditor compromises independence; Former practitioners who may have a relationship with the auditee; Loans between an auditing firm and its client; Financial interests of close family members; Joint investor or investee relationship with a client; Membership on the board of directors of the auditee; Litigation involving a CPA firm and its client may serve to limit independence as well.
Consulting and other non-audit services provided to the client. Unpaid fees that the client owes to the CPA. RuleGeneral Standards, consist of compliance with 1 professional competence, 2 due professional care, 3 planning and supervision, 4 sufficient relevant data. Rule a member who performs auditing, review, management consulting, tax or other professional services shall comply with standards published by bodies designated by Council.
The sequence of rules to reinforce standards published by other accounting bodies, such as the FASB, which means that a violation of an auditing standard is automatically a violation of the rules of conduct.
Rule is about confidentiality.The code of professional conduct of the America Institute of certified public accountants has two sections – principles and rules.
The principles provide a campus for the rules, the rules that govern the performance of all its professional members. The code of conduct includes six principles that form the foundation for the rules of AICPA.
The principles include responsibilities, public interest, integrity, objectivity and independence, due care and the scope and nature of services. Aicpa Code of Professional Conduct; Aicpa Code of Professional Conduct. ESSAY SAMPLE . The AICPA Code of Professional Conduct establishes the fundamental principles of professional ethics: Responsibilities: Due to the important role they play in society, CPAs have a significant responsibility for the services they provide.
A revised version of the Code of Professional Conduct is now available on a dynamic new online platform. Online Code of Professional Conduct We are the American Institute of CPAs, the world’s largest member association representing the accounting profession.
Our history of serving the public interest stretches back to Today, you'll. Lesson Professional Ethics There are six ethical principles of conduct: This sixth principle applies to CPAs in the attest function; the other five principles apply to all CPAs.
While the principles are broad guidelines, the rules of conduct are more specific, and are enforceable. This is implied by the word "rule", as opposed to. The purpose of the AICPA is to equip CPAs to fulfill their duties to the public sector. We will write a custom essay sample on Rules of Professional Conduct specifically for you for only $ $/page.
Section 50 – Principles of Professional Conduct. ().