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Ethics Accounting

Uploaded by masterstudent on Apr 02, 2007

The purpose of ethics in business is to individuals to abide by a code of conduct that facilitates, if not encourages, public confidence in their products and services. In the accounting field, the AICPA maintains and enforces a code of professional conduct for public accountants. Professional accounting organizations recognize the accounting profession's responsibility to provide ethical guidelines to its members. The AICPA's first principle of professional conduct states: "In carrying out their responsibilities as professionals, members should exercise sensitive professional and moral judgments in all their activities." A profession is formed on the basis of (1) a generally accepted body of knowledge, (2) a widely recognized standard of attainment, and (3) an enforceable code of ethics. A code of ethics is a crucial element in forming a professional. The three major accounting professional organizations have an ethics code.
The Financial Accounting Standards Board is a major organization whose primary purpose is to develop Generally Accepted Accounting Principles in the United States (US GAAP), similar to what the Government Accounting Standards Board (GASB) does for local and state governments in the United States. The federal organization is responsible for maintaining independence standards in accounting, the powers of which come from the Congress. The FASB sets out to improve corporate accounting practices by enhancing guidelines set out for accounting reports, identifying and resolving issues in a timely manner and creating a uniform standard across the financial markets. The mission of the Financial Accounting Standards Board is to establish and improve standards of financial accounting and reporting for the guidance and education of the public, including issuers, auditors, and users of financial information.

It is a seven-member independent board consisting of accounting professionals who establish and communicate standards of financial accounting and reporting in the United States. FASB standards, known as generally accepted accounting principles (GAAP), govern the preparation of corporate financial reports and are recognized as authoritative by the Securities and Exchange Commission.

The U.S. Securities and Exchange Commission is the United States governing body which has primary responsibility for overseeing the regulation of the securities industry. The SEC has five Commissioners who are appointed by the President of the United States with the advice and consent of the United States Senate. Their terms last five years and are staggered so that one Commissioner's term ends on June 5 of each year. To ensure that the SEC remains non-partisan, no more than three Commissioners may...

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Uploaded by:   masterstudent

Date:   04/02/2007

Category:   Accounting

Length:   6 pages (1,375 words)

Views:   9719

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