Participation and Discussion Questions Essay Example | Topics and Well Written Essays - 1250 words

Participation and Discussion Questions - Essay Example A specific ethical challenge an accountant could be confronted with is encountering a client that wants to underestimate the net income in order to lower his tax obligations. Accountants are not supposed to accommodate these types of requests from clients because it violates the code of ethics of the accounting profession as well as the generally accepted accounting principles (GAAP). Another ethical concern in regards to financial performance is payroll policies. Companies can decrease their labor costs by paying below market value to its employees, but such a practice can be counterproductive because personnel will be persuaded to leave the company and work for a competitor that pays better. 2. Discussion questions The Sarbanes Oxley Act of 2002 helped improved many aspects of the accounting profession that had ethical implications. For instance Section 404 of SOX deals with internal controls. These internal controls can be used to detect misappropriations and fraud. The Act increa sed the accountability of the profession. CEOs are now responsible for the accuracy of the financial statements. If fraud is detected the Sarbanes Oxley Act created capital punishment penalties of up to 25 years in prison. Sarbanes Oxley positive impacted Wall Street because it increased the customer confidence in the stock market. SOX helped safeguard the assets of a company. The Sarbanes Oxley Act also created auditor independence. The Enron scandal showed that how collusion can occur between and auditors and the managers when auditor independence does not exists. There things that could be done to improve the efficiency of the SOX law. Currently it is costing public companies over $1 million for compliance costs. The Sarbanes Oxley Act should be revised to eliminate the waste or inefficient processes that are causing compliance cost to escalate in the United States of America. Agency problems were reduced in companies that are complying in the Sarbanes Oxley Act of 2002. 3. Parti cipation - Gigi I agree with you to a certain extend that the use of cameras can be perceived as a breach of privacy, but in reality business are protected by the law because they have to right to monitor the work of its employees. A grey area in the practice is the usage of hidden cameras. The employee should know if they are being recorded by video. It is my opinion that hidden cameras without the knowledge of the employee that they are been recorded is unethical and could be violating civil rights, but I am not a lawyer. If anybody knows the answer to this please continue the discussion going. 4. Participation – David Accounting is a profession that functions well when the accounting staff has high moral and ethical standards. There have been rotten apples in the corporate world that have caused major accounting scandals such as WorldCom, Tyco, and Enron, but the majority of accountants are very honest people. All accountants know they have to comply with the generally acc epted accounting principles (GAAP). A lot of people don’t realize that accounting is a precise science that when prepared following GAAP will always give the same results. Currently the NBA and the players are on a lockout. To me it is sad that the players are claiming that the accounting losses of $300 million that the league suffered are not true considering the fact that a CPA certified those numbers. 5. Participation - Taneda I agree with you that ethics is extremely important in the business