Accounting Ethics

The mission of the Accounting

Focuses on the why of accounting transaction. Accounting assist managers and stakeholders in decision making for the business. Accountants provide financial documentation of the company financial position during a set fiscal period including a consolidati

Destructive Accountant

Not technically competent or ethically sensible, is not willing and is unable to follow standards.

Good-hearted Accountant

ethically sensible but lacks technical knowledge and is unable to act in accordance with accounting standards

Opportunistic Accountant

technically proficient but not ethical, willing to overlook standards to benefit himself or for highly favoured clients.

virtuous Accountant

Technically proficient and ethically sensible in carrying out his accounting duties. Standards are followed and actions are taken to promote the common good.


the people whose interests are affected by an organization's activities.
Insiders - board of directors, managers, employees
outsiders - stockholders, prospective investors, creditors, lending institutions and regulators

SOX (Sarbanes-Oxley Act)

A set of laws established to strengthen corporate reporting in the United States.

applied ethics

The manner in which principles of ethics are incorporated into professional conduct.

Dual role of accountants

applying technical competence and ethical sensibility when carrying out their accounting duties for the common good of all.

Accounting Standards for financial statements

Recognise revenue, liabilities, and distinguish between operating leases (expenses) and capital assets.

History of Accounting in higher education

Begin in 1980 with study for reform. The debates about who should teach ethics and how should ethics be taught. Many major scandals in fraud, embezzlement assisted in the tight formation of new regulations and changes in the accounting system.

Elements of a decision

The goal of the decision
The alternative or options to consider
Evaluation of options
Choice of a particular option, the decision
The action that is taken

Accounting Theory

The systematic logical description of the origins, development and current status of accounting in business and society. Considers the overall purposes of accounting and its standards, vocabulary and key concepts. Studies accounting institution and regul

Working definition of ethics

the use of logic and reason to distinguish right from wrong and to choose to do good rather than bad or evil.


idea that the goal of society should be to bring about the greatest happiness for the greatest number of people


Do your duty: act on the basis of the core principle.

Vitrue Ethics

focuses on the character and emotional capacity of the moral agent

Social Contract Theory


decision model

a). Define the problem
b). Identify problem-solving resources
c). Identify important characteristics of the decision environment
d). General and assess decision alternatives
e). Practical judgement and action

Accounting Standards


Accounting Standards

rules for preparing financial statements
a) When and how is revenue recognized in the financial statement.
b) What is the accounting standard for liabilities?
c) How are leases recognized in the financial statements?