Accounting fraud and corruption issues in the society
has become prevalent. According to the Committee of Sponsoring Organizations
(COSO), the number of fraudulent cases continued to soar high in between the
year of 1997 and 2007. While accountants are expected to follow the ethical
guidelines established by the accounting bodies, certain cases are still committed
despite having this customized code of conduct.
Accountants are a public server that is usually
looked upon as a business’ physician (Berger et. al., 1912). Most of the time,
they provide and examine timely financial information of an economic entity,
produce records and a summary of business transaction and interpreting the
result thereof to affect the business’ decision-making. With that being said,
they are required to work in an ethical manner in order to nurture and maintain
high professionalism in their line of career (PICPA). In addition, an
accountant following the ethical codes maintains public trust and shows fairness
and honesty in work.
Pakaluk and Cheffers in their text Understanding
Accounting Ethics stated that as a profession, accounting is in many respects
the most altruistic and ethically demanding of the professions. Finance and
accounting departments in industries are taking ethical considerations to be
extremely important (Vickers, 2005 as cited in Mathenge, 2012). So as to what
Smith and Smith (2003) have .stated, a well run business or profession must
have high and consistent standards of ethics in order to stand fast and to
stand the test of time.
However, fraudulent cases are still verging in some
business entities. Take for example the greatest corporate fraud case reported
in the American history, Enron Scandal, caused one of the top audit firms in
the United States, Arthur Andersen, to close forcefully due to the deliberative
manipulation of the business’ huge debts in the balance sheets. The scandal
brought into questions the accounting practices and activities of many
corporations in the United States. This gave rise to pass the Sarbanes-Oxley
act in the United States in 2002 to protect investors from corporate
While other accountants rigorously commit fraud,
others play a major role in fighting against it. IFAC CEO Choudrey said that
accounting profession is an important part of the cure in corruption and
fraudulent acts. In order to accomplish it, greater adoption of high-quality international
standards on financial reporting, auditing, and ethics are required.
With the above mentioned
issue and central idea, the main objective of this research is to determine the
role of an accountant in fighting fraud and corruption in society and the
significance of abiding in the ethical standards and principles of the
accountants in their profession.
The purpose of this study
is to let the accounting students, as early as possible, to acquire and learn
the ethical guidelines in order to be far-flung from committing such issue or
cases in the near future.