Ethics and Professionalism
“The Integrity of the Upright Shall Guide Them”
(Proverbs 11:3)
Learning Objectives
Reflect on the meaning and importance of
ethics in personal and professional life
 Define a profession; differentiate from trade
 Understand why professionals need ethics
 Understand basic ethical standards in the
Code of Professional Conduct for CPAs
 Learn and practice a process of ethical
decision making
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Ethics: What is it?
“A discipline of good and evil and moral
duty.” (Funk and Wagnalls)
 Actions and how they affect people
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Where did you get your ethics?
Parents
 Religion
 School
 Peers
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Concepts at the heart of ethics
Fairness
 Trust
 Respect
 Compassion
 Cooperation
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“He hath showed thee, o man, what is good, and what doth the Lord
require of thee, than to do justly, and to love mercy, and to walk
humbly with thy God.” (Micah 6:8)
The Sinking of the Titanic
What were the facts?
 Who were the stakeholders?
 What were the issues and values?
 What were the alternatives?
 What actions were taken?
 What were the consequences?
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When God Comes to Work
(managing religious diversity)
Facts?
 Stakeholders?
 Issues and values?
 Alternatives?
 Actions?
 Check?
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The Heinz Dilemma
Facts?
 Stakeholders?
 Issues and values?
 Alternatives?
 Actions?
 Check?
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Ethical problem you faced today?
Facts?
 Stakeholders (persons involved)?
 Issues and values?
 Alternatives?
 Action?
 Did you check yourself?
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What is a profession?
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A group of people pursuing a learned art
with a common calling
Factors unique to a profession
Common body of knowledge
 Formal educational process
 Standards of entry
 Recognition of public responsibility
 Willingness to act with restraint for the
common good
 Adoption of Codes of Conduct

Codes of Conduct for
Accountants
AICPA
 IMA
 IIA
 State Boards of Accountancy
 SEC
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Code of Professional Conduct
 AICPA Professional Standards, Vol. 2 (ET)
 Composition
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Principles
Rules
 Interpretations,
Applicability
 Compliance
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Rulings
Principles
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Preamble
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Requires all CPAs to assume the obligation of
self-discipline above and beyond requirements
of law.
Calls for unswerving commitment to honorable
behavior, regardless of personal advantage.
Article I -- Responsibilities
 Members should exercise sensitive
professional and moral judgments in all
activities
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Primary responsibility is to the “public”
Responsibility to cooperate with each other to
improve the art of accounting, maintain public
confidence, and carry out self-governance.
Article II --The Public Interest
 Serve the public interest, honor the public
trust, commitment to professionalism.
 Public interest: collective well being of the
people and institutions served
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Article III --Members should perform with
the highest sense of integrity
 The test for all decisions: “What would a
person of integrity do?”
 Characteristics:
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Honesty
Candor
Protective of confidentiality
Article IV -- A member should maintain
objectivity and be free from conflicts of
interest.
 A state of mind: the distinguishing feature
of our profession
 Impartiality, intellectual honesty, freedom
from conflicts of interest.
 Requires independence in attest situations.
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Article V -- Due Care. A member should
observe the profession’s technical and ethical
standards, strive continually to improve
competence and quality of service, and be duly
diligent in performing services.
Continual quest for excellence, commitment
to life-long learning and improvement.
 Requires assessment of competence, due
diligence, planning and supervision..
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Article VI -- Member in public practice should
observe these principles in determining scope and
nature of services.
Practice in firms that have quality controls
Determine whether other services might impair
audit independence.
Assess whether all roles assumed are consistent
with the role of a professional accountant.