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Team Report
Past and Current Perspectives on Ethics in
Accounting and Finance
Adam Bengmark
Tyler Shook
Patric Brunner
Rachel Clark
English 3100-101
Business Writing
7 April, 2015
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Transmittal Memo
To: Rachel Clark
From: Adam Bengmark
Date: 7 April, 2015
Subject: Team Report
Here is the report you requested on ethics in Accounting and Finance. We are three students, two
of us are majoring in accounting and one of us in finance and banking. In our report you will find
a majority of the topics discussed about ethics in both accounting and finance. Even if it is two
different alignments they both have their similarities and a large amount of information from our
sources can be related to each other.
There are many ethical issues in finance and accounting, and this paper we are reviewing some
of them. In our report you will find a majority of the topics being discussed, all from resources
that both are reliable and reputable and well researched in our attempt at finding well rounded
reports to support our other findings.
We performed our best in attempting to remain as objective as possible. Keeping our personal
opinions and persuasions out of the report. There is a time and place for convincing arguments,
but a formal report is not it. We achieved this through the use of meaningful quotes and analysis
of important points made by our research. The full purpose of this assignment is to report on
issues relating to ethics in our respective fields, and that was our aim this whole process.
We have organized the report in a way that can be easily followed. Starting off we explained how
that different genders view of ethical issues are not the same and that promotions can be affected
by bias in genders. Then we go on to talk about how ethical codes in accounting and finance are
mandatory and those who break ethical code can be punished criminally. Then we finish up
explaining how accounting and finance are fields that depend on trust and how being ethical is
important in gaining trust.
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Table of Contents
I. Executive Summary............................................................................................................iv
II. Introduction..........................................................................................................................1
III. Report on Financial and Accounting Ethical Issues............................................................2
Different gender’s views on ethical issues
Unfair bias in promotions
Mandatory acceptance of ethical codes
What is best for the business is not always best
Why ethical decision can be hard
Companies violate basic societal rules
Philanthropy can be profitable
Accounting as a field based on trust
Comparison between decision trees and finance crisis
IV. Conclusion...........................................................................................................................7
V. References............................................................................................................................8
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Executive Summary
Whether it is a conflict of interest, gender bias, or outdated regulations, ethics in accounting and
finance is an important topic of discussion that is only growing more interesting. Keeping up to
date with current standards and being aware of trending issues is at the forefront of lawmakers’
minds with an emphasis on maintaining the public’s trust and fairness within the professional
workplace. As trends have become outdated and new issues arise, it is crucial that standard
setting organizations like the American Institute of Certified Professional Accounts stay ahead of
the game in making sure policies are actually helping organizations and are specific enough to
cover broad areas. Overall, the purpose of this report is to help highlight changes in these ethical
topics and get some feedback from professional editors and the official organizations.
Our research yielded much useful information relating both on the subject of changing times and
learning from the past. One useful article from the AICPA Professional Ethics Team displayed an
easy to use decision tree for making ethical decisions. In addition to further explanation, this tree
helps to understand where to go in making an ethical decision, even if it is an over simplification.
Comparing this with Lia’s Accountability and Enforcement of Ethical Values in Finance, we can
see that it is essential for companies to set up proper procedures for what to do when faced with
ethical issues.
What makes our report unique? While the fields of accounting and finance may overlap in many
ways, they also are distinctly different from each other. The financial emphasis in our report
focuses on the effects of the global crisis and how it affected the way we look at ethical issues
relating to making known the financial standing of companies and preventing as much
misinterpretation as possible. Keeping the public’s trust is wildly accepted as essential for the
financial industry, so proper analyses of the financial crisis yields important information to help
prevent a similar crash.
On the other hand, the financial crisis helped shape better regulations for accounting standards. It
is easy for a company to make their status seem more positive than it really is or reflect less
expenses than it really has. Generally Accepted Accounting Principles (GAAP) which all major
public accounting firms must obey, can still have a way of convoluting or misreporting financial
data. So while a company can be reporting their books in a technically correct fashion, they are
in actuality misdirecting their shareholders and misrepresenting their true situation.
Further, in this report we discuss the effects philanthropy can have on an organization. It is
natural for humans to want to improve the society that we inhabit even if it at first does not make
financial sense. There are a great many corporations that fund events for charity and even donate
money to help build parks and hospitals. The ethics behind this is that it from another perspective
this can be seen as using shareholders money without the purpose of turning a profit, which is the
agree upon function of investing in a company. The study we found however, argues that the
value a service like children homes may in fact enhance that profitability in the respective area.
Ethics have been a problem in Accounting and Finance in the past but with the new standards
being watched closely the problems with ethics have decreased. With the AICPA making an
ethical decision tree with clear steps to follow, accountants should be able to make better choices
and have a better knowledge of what is ethical. Along with the decision tree the Sarbanes Oxeley
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Act has provided “whistleblowers” with more protection when they report illegal activity within
a company. These specific rules to follow and protection for the ones who report problems gives
accountants more incentive to do the right thing or they can face big fines or even jail time.
Different genders also can have different views on how to deal with ethical issues. Studies have
shown how men and women in the workplace deal with ethical offenders. For example, women
being less tolerant of low balling and men being less tolerant of inventory manipulation (Jeffery,
2012). How different genders view ethical issues is a very interesting and not very thoroughly
researched topics, however, some of our research will help enlighten areas of interest even
including information about accounting students. Given that our group is comprised of college
students, this was particularly interesting. In many studies men and women are measurably
predisposed to be more aware of ethical issues if they are accounting majors.
