Chapter 4
Professional Ethics
What Are Ethics?
A set of moral principles or values
It is the glue that holds a society together
Unethical behavior: conduct that difers from what they believe is appropriate
given the circumstances.
Why people act unethically?
Person’s ethical standards difers from general society
Ex: drug dealers, bank robbers, larcenists
The person choses to act selfshly
The person knows that the behavior is inappropriate but chooses to it anyway
because of the personal sacrifce needed to act ethically
Six Core Ethical Values
Trustworthiness
Respect
Responsibility
Fairness
Caring
Citizenship
Ethical Dilemmas
A situation a person faces in which decision must be made about the appropriate
behavior.
Rationalizing Ethical Behavior
- Everybody does it
- If it is legal, it’s ethical
- Likelihood of discovery and consequences
Resolving Ethical Dilemmas
1. Obtain relevant facts
2. Identify the ethical issues from the facts
3. Determine who is afected by the outcome of the dilemma and how each
person or group is afected
4. Identify the alternatives available to the person who must resolve the
dilemma
5. Identify the likely consequence of each alternatives
6. Decide the appropriate action
, Code of Professional Conduct
o Client. Any person or entity, other than the member’s employer, that
engages a member or a member’s frm to perform professional
services.
o Firm. A form of organization permitted by law or regulation whose
characteristics conform to resolutions of the Council of the American
Institute of Certifed Public Accountants that is engaged in the practice
of public accounting. Except for the purposes of applying Rule 101,
Independence, the frm includes the individual partners thereof.
o Institute. The American Institute of Certifed Public Accountants.
o Member. A member, associate member, or international associate of
the AICPA.
Professional Ethics
What Are Ethics?
A set of moral principles or values
It is the glue that holds a society together
Unethical behavior: conduct that difers from what they believe is appropriate
given the circumstances.
Why people act unethically?
Person’s ethical standards difers from general society
Ex: drug dealers, bank robbers, larcenists
The person choses to act selfshly
The person knows that the behavior is inappropriate but chooses to it anyway
because of the personal sacrifce needed to act ethically
Six Core Ethical Values
Trustworthiness
Respect
Responsibility
Fairness
Caring
Citizenship
Ethical Dilemmas
A situation a person faces in which decision must be made about the appropriate
behavior.
Rationalizing Ethical Behavior
- Everybody does it
- If it is legal, it’s ethical
- Likelihood of discovery and consequences
Resolving Ethical Dilemmas
1. Obtain relevant facts
2. Identify the ethical issues from the facts
3. Determine who is afected by the outcome of the dilemma and how each
person or group is afected
4. Identify the alternatives available to the person who must resolve the
dilemma
5. Identify the likely consequence of each alternatives
6. Decide the appropriate action
, Code of Professional Conduct
o Client. Any person or entity, other than the member’s employer, that
engages a member or a member’s frm to perform professional
services.
o Firm. A form of organization permitted by law or regulation whose
characteristics conform to resolutions of the Council of the American
Institute of Certifed Public Accountants that is engaged in the practice
of public accounting. Except for the purposes of applying Rule 101,
Independence, the frm includes the individual partners thereof.
o Institute. The American Institute of Certifed Public Accountants.
o Member. A member, associate member, or international associate of
the AICPA.
