Topics: Business ethics, Ethics, Fraud Pages: 4 (1336 words) Published: March 2, 2014

In recent years, accounting ethical breaches has emerged as a major problem for most organizations. With growth of businesses, the number of accounting ethical breaches has also increased. Accounting ethical breaches may be defined as the misappropriation and misconduct of financial data by the auditors and accountants of the company (Duska & Ragatz, 2011). The accounting ethical breaches not only affect the organization, but also the stockholders involved with the organization. This paper will discuss the accounting ethical breach in Enron. This paper will also discuss ethical issues, accounting ethical breaches and the recommendations to prevent such breaches. Ethical Behavior in Current Business and Regulatory Environment With increasing number of corporate ethical breaches, the role of unethical behavior has decreased in organizations. The organizations are more supportive to ethical behavior ensuring risk, compliance and governance culture within organization. As a part of this culture, effective communication around ethical practices has been followed by the organization. Since ethical breaches are mainly done for the sake of money, rewarding and ethical practices has effectively helped organizations to minimize the ethical breaches (Ferrell & Fraedrich, 2009). At the same time, ethical breaches have not only affected the image of the company, but are also responsible for its failure. This is also one of the major reasons why current businesses and regulatory environment are more conductive to ethical behavior. It is the result of its impact that organizations have introduced Sarbanes-Oxley 404 compliance, a guideline that helps organizations to meet the criteria of ethical behavior. Wall-Mart has also been accused of violating ethical policies accepting discounts from vendors, who are eager to work with company. This has subsequently affected the image of the company in the market. Similarly, right leadership values are also given...
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