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Corporate ethics: doing the right thing in the real world. (FirstLook: Special Advertising Section).


Financial managers and accountants are today faced with increasing responsibility for compliance with all manner of financial reporting requirements. As the number of financial restatements has grown and questions about management integrity have shaken investor confidence, the roles of financial managers and accountants have taken on both more importance and greater risk.

Investors have come to the realization that financial decision-making is rarely a simple black or white choice; rather, they now understand that the variety of ways in which a complex transaction can be structured may dictate the accounting result. For this reason, many institutional investors Institutional Investor

A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions.
 are now more concerned with the personal values and integrity of financial managers and accountants than with other, more traditional investment criteria.

At the same time that financial managers and accountants have assumed a more prominent position in the management hierarchy, exposure to liability for financial decision making is at an all-time high. Civil litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute.

When a person begins a civil lawsuit, the person enters into a process called litigation.
 can no longer be counted on as the last word in liability for deficient financial reporting, and the search for more sources of recovery means that financial managers and accountants are more likely than ever to become targets in legal actions, regardless of their culpability culpability (See: culpable) . Against this backdrop, financial managers and accountants must maintain and enhance their decision making skills within a values-driven environment or may suffer the consequences of their failure to do so.

This book is designed to provide the CPA (Computer Press Association, Landing, NJ) An earlier membership organization founded in 1983 that promoted excellence in computer journalism. Its annual awards honored outstanding examples in print, broadcast and electronic media. The CPA disbanded in 2000.  a series of case studies that illustrate real-world ethical dilemmas and application of values consistent with the high standards of the profession.

In this regard, the CPA can expect to encounter issues addressed in recent Staff Accounting Bulletins, Financial Reporting Releases, SEC Statements and Cautionary Advice, Rule 102(e) of the SEC's Rules of Practice, various provisions of the Securities Exchange Act, the Foreign Corrupt Practices Act Foreign Corrupt Practices Act

An amendment to the Securities Exchange Act created to sanction bribery of foreign officials by publicly held US companies.


Foreign Corrupt Practices Act 
, and newly enacted industry legislation.

The Case Studies

Include ethics topics This list of ethics topics puts articles relevant to well-known ethical (right and wrong, good and bad) debates and decisions in one place - including practical problems long known in philosophy, and the more abstract subjects in law, politics, and some professions and sciences.  encompassed by professional ethics professional ethics,
n the rules governing the conduct, transactions, and relationships within a profession and among its publics.

professional ethics liability,
n 1.
 codes issued by state accounting societies and accountancy boards, and topics addressed in the AICPA AICPA

See American Institute of Certified Public Accountants (AICPA).
 Code of Professional Conduct, such as:

* independence

* integrity and objectivity

* confidentiality

* contingent fees, including commissions and referral fees

* compliance with audit, consulting and other standards

* client records

* offering services over the Internet

* internal accounting controls, procedures and records

* procedures concerning identification, reporting and investigation of accounting irregularities

* and more

Robert W. Walter is a partner in the law firm of Berliner Zisser Walter & Gallegos, Denver. This is adapted from his new AICPA book, "Corporate Ethics."
COPYRIGHT 2003 American Institute of CPA's
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2003, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Article Details
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Author:Walter, Robert W.
Publication:Journal of Accountancy
Date:Jun 1, 2003
Words:407
Previous Article:CFO Quarterly Roundtable Series. (Upcoming AICPA Live Webcasts: Special Advertising Section).
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