Why Are Ethics Important in Accounting?

Why Are Ethics Important in Accounting?
Why Are Ethics Important in Accounting? (Image: Public Domain, Wikimedia Commons)

Why are Ethics Important in Accounting?

Proper ethics and ethical behavior are extremely important in accounting for a variety of reasons. To begin with, accountants are often privy to sensitive information regarding their clients, such as Social Security or bank account numbers. This gives accountants a good deal of power in regard to their clients and it is important that the trust between an accountant and their clients not be abused. In the same way it is important that the industry itself does not become stigmatized as an unethical one, something that could potentially harm business for all accounting firms.

What Can Result from Poor Ethics in Accounting?

Many negative consequences can result from poor ethics in accounting practices. The first result is generally a lag in business. Accounting firms rely heavily on word-of-mouth for promotion, and it's all too easy for a few bad stories about unethical behavior to sway prospective clients away from a particular firm. There can also be serious legal repercussions for those who are found to be violating legal codes and standards for their jurisdiction

What Can I Do to Be an Ethical Accountant?

To begin with, study your area's legal statutes regarding accounting practices. While it is true that what is legal and what is ethical can be two different things, the legal code is a good basic guide to help you understand the prevailing feeling towards what is right. Likewise, make sure that you always put the interests of your clients ahead of your own, that you safeguard client information doggedly and never behave in a fashion that you know to be wrong while handling accounting work.

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