Discussion Topic: Ethics and the Auditor.
Please reply to 1 other student in 2 paragraphs. In the first, clearly state with which parts of the other student’s thread you agree or disagree. In the first paragraph, you must provide an explanation for why you agree or disagree with the other student’s post. In the second paragraph, add some additional comments of your own that add to the discussion.You will submit a reply to 1 other student’s thread from the previous module/week. Each reply must be at least 250 words.
Ethics is defined as “a code or moral system that provides criteria for evaluating right and wrong” (Spiceland, Sepe, & Nelson, 2013, p. 18). When it comes to auditing, there is a major necessity for adherence to ethical standings. Auditors should hold themselves accountable to maintaining a working knowledge of accounting principles and regulations, in order to better ensure that they are abiding by them. Furthermore, auditors should ensure that they hold themselves to high ethical standards. Auditors are responsible for taking a deeper look into potential discrepancies in accounting, and then reporting these discrepancies to governing bodies. Just as auditors should ensure that any discrepancies are reported, they should not be unfair in these reports simply to gain a higher reputation in the eyes of their managers. As the Bible says in Proverbs 21:6, “the getting of treasures by a lying tongue is a fleeting vapor and a snare of death” (ESV) Auditors should never take advantage of taxpayers simply because they believe that they are able.
At the core of things, the role of an auditor is basically to ensure that taxpayers are being ethical. For this reason, it’s crucial that ethics be shown throughout corporations in hopes that it will flow down the chain of command. Ethics, “in the imperative sense is a function of moral rules and principles and does not involve a situation-specific calculation of the consequences” (Louwers, Ramsay, Sinason, Strawser, & Thibodeau, 2015, p. 593). The American Institute of CPA’s has its own set of rules of conduct that must be followed when performing an audit. Some of the principles that are highly stressed in these rules of conduct are “responsibilities, the public interest, integrity, objectivity and independence, due care, scope and nature of services” (Louwers, Ramsay, Strawser, & Thibodeau, 2015, p. 597).
Auditors should ensure that they show independence from their clients, to avoid even the slightest hint of unethical behavior. There are many things that auditors should avoid, in order to show completely unbiased work. Ones’ integrity is of upmost importance in any walk of life. As mentioned, there are many rules and regulations that have been set in order too better ensure ethical compliance. One of these rules includes keeping client information confidential. Rule 301 states, “a member in public practice shall not disclose any confidential information without the specific consent of the client” (Louwers, Ramsay, Sinason, Strawser, & Thibodeau, 2015, p. 612). Clients trust that auditors will keep their information private throughout the entirety of the process.
Louwers, T. J., Ramsay, R. J., Sinason, D. H., Stawser, J. R., & Thibodeau, J. C. (2015). Auditing and assurance services. (6th ed.). New York, NY: McGraw-Hill Education.
Spiceland, J. D., Sepe, J. F., & Nelson, M. W. (2013). Intermediate accounting. (7th ed.). New York, NY: McGraw-Hill Education.
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