Accounting Ethics, 2nd Edition

Preface.

Introduction.

1 The Nature of Accounting and the Chief Ethical Difficulty: True Disclosure.

I The Nature of Accounting.

II Ethics of Disclosure.

III The Financial Statement.

IV Roles an Accountant can Fulfill.

V Development of Explicit Accounting Standards and Regulations.

VI The Sarbanes–Oxley Act (SOX).

VII Recent Scandals that Provoked More Regulation.

VIII Conclusions.

2 Ethical Behavior in Accounting: What Is Ethics?.

I What Is Ethics?.

II Ethics: The Intellectual Enterprise.

III Actions.

IV Social Practices, Institutions, and Systems.

V Why Study Ethics?.

VI Being Ethical: How to Determine What to Do.

VII Questions to Ask to Justify An Action: The Basis of Ethical Theory.

VIII Using the Reasons.

IX Ethical Dilemmas.

X Some Classic Moral Dilemmas.

3 Ethical Behavior in Accounting: Ethical Theory.

I Egoism.

II Utilitarianism.

III Kant and Deontology.

IV Deontological Ethics.

V The First Formula of the Categorical Imperative.

VI The Second Formula of the Categorical Imperative.

VII Virtue Ethics.

4 Accounting as a Profession: Characteristics of a Profession.

5 Accounting Codes of Conduct.

I AICPA Professional Code of Conduct.

II Code Principles.

III Criticisms of the Code of Conduct.

6 The Rules of the Code of Conduct.

I Section 100 – Independence, Integrity, and Objectivity.

II Section 200 – General Standards Accounting Principles.

III Section 300 – Responsibilities to Clients.

IV Section 400 – Responsibilities to Colleagues.

V Section 500 – Other Responsibilities and Practices.

7 The Auditing Function.

I The Ethics of Public Accounting.

II Trust.

III The Auditor’s Responsibility to the Public.

IV The Auditor’s Basic Responsibilities.

V Independence.

VI Independence Risk.

VII Professional Skepticism.

VIII Reasonable Assurance.

8 The Ethics of Managerial Accounting.

I Reasons Used to Justify Unethical Behaviors.

II Blowing the Whistle.

9 The Ethics of Tax Accounting.

10 Ethics Applied to the Accounting Firm.

I Accounting as a Business.

II The Social Responsibility of Business.

III Good Ethics is Good Business.

IV Ethical Responsibilities of Accounting Firms.

V The Accounting Profession in Crisis.

Afterword: Current Debates on Accounting Issues.

I Fair Value and Principles vs. Rules.

II Fair Value Accounting.

III Arguments For and Against the Fair Value Approach.

IV Summary.

V Principles vs. Rules.

VI Introduction.

VII Isn’t GAAP Already Principles Based?.

VIII An Example: The Continental Vending Case.

IX Recent Developments of “Present Fairly”.

X A Better Question.

XI Argument for a Rules Based Approach.

XII What Would a Principles Based Approach Look Like? The True and Fair Override.

XIII Argument for a Principles Based Approach.

XIV Conclusion.

Appendix A: Summary of Sarbanes–Oxley Act of 2002.

Appendix B: The IMA Code of Conduct for Management Accountants.

Index.

Brenda Shay Duska MT, CPA, is currently a manager at Del Pizzo & Associates, specializing in taxation. She is a member of the Pennsylvania Institute of Certified Public Accountants and the Society for Financial Service Professionals.  She serves on the boards of the non-profit, MusicWorks and the Greater Philadelphia Chapter of the Society for Financial Service Professionals.

Julie Ragatz is Assistant Professor of Ethics at The American College and the Associate Director of The Center for Ethics in Financial Services. She is currently finishing her PhD in philosophy at Temple University where she concentrates on ethical theory and applied ethics.