AICPA Code Of Conduct Analysis

For the accounting field, the American Institute of Certified Public Accountants (AICPA) maintains and enforces a code of professional conduct for public accountants. By adhering to the code, accounting professionals assume an obligation of "self-discipline above and beyond the requirements of laws and regulations" (AICPA, 2006, para. 8). The duties placed on accounting professionals by the code of ethics require "professional competence, confidentiality, integrity, and objectivity" (Bookrags, 2006, para. 4). Accounting professionals should only accept responsibilities that they can accomplish proficiently. They must complete their tasks carefully, confidentially, with ample precision and without bias.

AICPA Code of Professional Ethics

The
"Maintaining integrity and objectivity calls for avoiding both actual and apparent conflicts of interest" (Bookrags, 2006). This concept is independence. In accounting, independence is to act (and the appearance to have acted) unbiased, impartial, and objective. Independence is the fundamental concept to the accounting profession. The accounting work product has no value if these rules of independence, integrity, and objectivity are not followed.

In the independence section of the code, the areas that put independence at risk are listed. Relationships are a key factor. For example, accountants must avoid any relationships that may result in the dependence on a particular client, including financial interests and client management. Accountants should not audit a company they own stock in. The task of the accountant should reflect the results of client 's operating decisions and not the accountant 's opinion.

The last three sections of the AICPA code deal with the accountants responsibilities to the people who they serve. Accountants have duties to their clients, their colleagues, and to themselves. These duties include professionalism, confidentiality, and credibility. Members of the AICPA must behave in a business-like manner. An accountant should never disclose confidential information. Accountants must instill confidence and belief from those they work for and with.

Enforceability of
These laws are administered and monitored by the Securities and Exchange Commission (SEC). The SEC regulates companies that are publicly traded. The SEC requires publicly traded companies to have their financial statements audited by an independent CPA. The SEC establishes and enforces the auditing standards and procedures for this purpose (Bookrags, 2006).

Certain code violations will lead to civil accountant liabilities, while some can lead to criminal accountant liabilities. Fraudulent financial reporting is reported to the SEC and can lead to criminal prosecution. Malpractice is reported to the AICPA and can lead to civil liabilities. In the financial sector, insider trading is closely monitored by the SEC, and they have the right to ask the courts to impose criminal and civil penalties.