Ethics-OJT Task 2

John Lexter Macalber BSA V
Time-in: 7:45 am Time-out: 3:08 pm

Ethics
1. Define "Ethics"
Ethics has several meanings when looked in a general perspective, but when
narrowed down in an accounting scope, ethics is a matter of both guidelines and
principles. Ethics can be described as a set of moral behaviors that influence
principles within a business or organizational environment.
2. What is the basic purpose of a code of ethics for a profession?

The basic purpose of a code of ethics for a profession is to establish a set of
principles designed to help professionals distinguish right from wrong in order to
govern their decision-making. Often referred to as an ethical code, these principles
outline the mission and values of an organization, how the professionals within the
organization are supposed to approach problems and the standards to which the
employees are held. It allows professionals to set a baseline expectation for what is
socially acceptable and how professionals should approach problems.
3. Name and explain the characteristics and values associated with ethical behavior.
Integrity: Integrity is not a set of rules or a course of action, but rather a state of mind
oriented towards honesty, straightforwardness and a commitment to acting following
principle rather than for the sake of personal gain.
Objectivity: To the extent that it is humanly possible, accountants shouldn't be
influenced by the interests or perspectives of the individuals or businesses who hire
them. An accountant also shouldn't let personal biases or interests influence either
the numbers that go into an accounting system or the results that come out of it.
Figures and results should be taken at face value and should drive conclusions and
decisions.
Professional Competence and Due Care: The field of accounting isn't a static body
of knowledge but rather an evolving frame of reference that changes as legislation
and best practices are redefined over time. It is the responsibility of an ethical
accountant to stay abreast of these developments and provide clients with up-to-
date information and the highest quality service.
Confidentiality: Accountants handle sensitive information, and it is an accountant's
ethical responsibility to refrain from disclosing any of this information to outside
parties who may stand to gain from it. Similarly, an accountant shouldn't use any
information obtained while performing professional services for the sake of personal
gain, such as selling stock in a business whose books appear questionable.
Professional Behavior: As with any profession, an accountant should perform tasks
and responsibilities with an eye to the highest personal and professional standards.
These include completing tasks thoroughly and on time, following through on
commitments and only accepting payments for services that have been rendered.
4. Explain why ethical behavior is necessary.
Ethical behavior is necessary because it not only guides a certain individual, but it
guides the organization as a whole to the right values, behavior, and decisions. It
sets tone for how the entire company runs on a day-to-day basis. In addition to that,
it helps Employees make better decisions in less time with business ethics as a
guiding principle, this increases productivity and overall employee morale.
5. What are some of the reasons why people act unethically?

Unethical behaviors can be driven by individual, issue-specific, and environmental
factors.
Individual factors: Unethical choices are more likely from people with specific
personal characteristics — specific views and values. Overwhelmingly, these
employees are driven by self-interest. For example, they manipulate others for their
own personal gain, fail to see the connection between their actions and outcomes,
and believe that ethical choices are driven by circumstance. They obey authority
figures’ unethical directives and act merely to avoid punishment.
Issue specific factors: An employee might make an unethical choice in one situation,
but not in others. Some issues are more likely to lead to unethical choices.
Employees are more likely to act unethically when they don’t see their action clearly
causing harm — for example, when the victim is far away or the damage is delayed.
Unethical choices also occur when an employee feels that peers will not condemn
their actions.
Environmental factors: Unethical choices are more likely when the organization
encourages individualistic behavior rather than doing what is best for other
employees, customers, and the community. For example, the performance
management system might reward individual bottom-line achievement, no matter
how it is achieved.
6. Describe some of the principles and or values that are related to
a. Personal ethics – integrity can be considered as related to personal ethics in

view of it requires oneself to be honest, candid and forthright with a client's
financial information.
b. Professional ethics – due care and competence can be, in a way, related to
professional ethics. Since it requires a person to observe all technical or ethical
accounting standards. Professional accountants are often required to review
generally accepted accounting principles (GAAP) and apply this framework to a
company's specific financial information. Due care requires accountants to
exercise competence, diligence, and a proper understanding of financial
information.
c. Business ethics – independence is related to business ethics by means of one
must remain free from conflicts of interest and other questionable business
relationships when conducting accounting services. Failure to remain objective
and independent may hamper an accountant's ability to provide an honest
opinion about a company's financial information. Objectivity and independence
are also important ethical values for auditors.
7. Explain why ethical behavior is necessary in the practice of one's profession.
Ethical behavior is necessary in the practice of one’s profession because it helps

employees strike a balance between the ends and the means used to obtain them.
This balance may be one of the most challenging aspects of being an ethical
organization. The Federal Sentencing Guidelines for Organizations provide an
additional incentive for having corporate codes of ethics and ethics training.
Companies that have made a bona fide effort to prevent unethical and illegal
behavior are likely to receive less severe punishment should an employee be found
guilty of breaking the law. The unethical conduct of just a few employees can affect
an entire corporation.

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John Lexter Macalber BSA V

Time-in: 7:45 am Time-out: 3:08 pm

2. What is the basic purpose of a code of ethics for a profession?

5. What are some of the reasons why people act unethically?

a. Personal ethics – integrity can be considered as related to personal ethics in

7. Explain why ethical behavior is necessary in the practice of one's profession.

Ethical behavior is necessary in the practice of one’s profession because it helps

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