Ethics and Internal Auditors

Professionalism, Ethical Codes and the Internal Auditor: A Moral Argument

Mary Ann Reynolds

ABSTRACT. This paper examines the case of the internal auditor from a sociological and ethical perspective. Is it appropriate to extend the designation of professional to internal auditors? The discussion includes criteria from the sociology literature on professionalism. Further, professional ethical codes are compared. Internal auditors’ code of ethics is found to have a strong moral approach, contrasting to the more instrumental approach of certified professional accountants. Internal auditors are noted as using their code of ethics to help resolve professional ethical dilemmas.

Introduction Society grants professional standing to those groups which contribute to the well being of the broader society. Business experts in such groups as business ethics consultants and internal auditors lay claim to professional standing which if granted enhances both their credibility and marketability. But is this claim justified? Although business ethicists are beginning to debate this issue they presently lack a common body of knowledge or agreed upon expertise. As defined expert knowledge is one of the common criterion for professional definition their claim awaits the development of consensus (Cohen, 1992; Stark, 1993; and Dean, 1997) However a similar group, internal auditor’s have a fifty year history of moving to achieve this recognition. This paper will examine the justification of their claim to professionalism in light of current practice.
Mary Ann Reynolds is assistant professor of accounting at Western Washington University. Her current research publications are primarily in the areas of ethics, and environmental accounting.

This is of importance to society because internal auditor’s provide a peculiar service in that they contribute to the control of the integrity of financial information in a market economy. Public accountants, represented by the American

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