In an industry which is blighted with digits, the topic of ethics can be somewhat surprising for certain people involved in accountancy. In other words, few people realize that this is a field which is bound by certain ethics – which must be adhered to in a bid to keep everything above board.
George Ammar is an individual who knows plenty about this subject. He is someone who has focused particularly on the Cleveland/Akron, Ohio area over his career – and also someone whose experience is barely rivaled.
Bearing all of the above in mind, we will now take a look at some of his reasons why ethics within accountancy is so important in the modern-day industry.
The reliance by shareholders
This is the principal reason why it’s absolutely essential for accountants to abide by a code of ethics in their profession. A lot of accounts are prepared specifically for shareholders, or at least potential shareholders, and any misleading information could hinder their decision-making process immensely.
If shareholders can rely on a set of accounts that have been put together in ethical fashion, the chances of them making the correct next decisions are much higher.
It’s worth mentioning that it’s not just the accountants who prepared the statements which are under an obligation to stick to such ethics. The other professionals who fall into this category are the auditors, for the simple reason that these are the people who are charged with the task of confirming the figures that have been documented by the accountants. In other words, it requires ethical conduct from both of these professionals to provide the most accurate insight to shareholders and key decision-makers.
The avoidance of ethical dilemmas
This next benefit relates to the accountant directly. There might be occasions where a decision they are poised to make might not benefit the company they are representing – which therefore makes it difficult to take. In other words, it might paint the company in a bad light, but be beneficial for the general public who gain said information.
It’s in these instances where a code of ethics can guide accountants. Without them, their obligation is only to the company and this can result in decisions which might not be made for the greater good. With them, they are under an obligation to always make the “right” decisions – even if this doesn’t represent the company they work for in the best light possible.
The benefits to the industry as a whole
As we all know, the accounting profession hasn’t been covered in complete glory over recent years. Various mistakes and blunders have been made, all of which have cast a lot of unwanted public attention on the industry.
To make matters more complicated, there are so many organizations that it makes it impossible to implement a direct set of rules for each to follow. Instead, through the use of ethics, there can be a more flexible approach to rules. Ethics can be applied to different organizations; they aren’t as black and white as rules. It means that the accounting industry as a whole should benefit as everyone is performing their job under the same views.