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Accounting, Business and Ethics

Answer questions 4 and 5. Provide a hypothetical example to illustrate your answer to question 4. Explain your answers thoroughly.

4. When should an accountant place his or her duty to the public ahead of his or her duty to a client or employer?

5. Which would you choose as the key idea for ethical behavior in the accounting profession: "Protect the public interest" or "Protect the credibility of the profession." Why?

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4. Because they are responsible for large sums of money and the potential impact upon society at large, accountants are expected to uphold relatively high ethical standards. Scandals such as Enron and Worldcom have shown exactly what the potential impact upon society can be from improper accounting methods and outright fraud.

The primary responsibility of a company is to maximize shareholder wealth so long as measures taken are legal, moral, and ethical. While it is true that accountants have a duty to their clients and/or employer, their primary goal is outlined in the first sentence. If an accountant is employed by a publicly held company, the shareholders' wealth is the primary concern. Since there may be millions of shareholders, the general public can be considered to be the shareholders. In ...

Solution Summary

The solution describes when an accountant should put his or her professional duty ahead of his or her employer's interests. It is about 553 words.