Issues in Accounting and Ethical Approach

Australian Accounting Standards Board
Submitted by
Student’s Name:
Date: 25th April 2019
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Table of Contents
Introduction.....................................................................................................................................3
Task 1...............................................................................................................................................3
Task 2...............................................................................................................................................4
Task 3...............................................................................................................................................5
Conclusion........................................................................................................................................7
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Introduction
Ethical approach forms the base of accounting and accountants around the world needs to follow
that. In this assignment the various issues related to accounting and the different method of
accounting has been explained, with respect to different rules of accounting and the code of ethics
that the accountants need to follow. It also highlights the issues that the accountants face while
acting as an ethical professional, and why is it of utmost importance is also highlighted.
Task 1
The fundamental principles of ACCA includes the code of ethics that accountants need to follow in
their accounting profession. The code of ethics includes the principles of integrity, objectivity,
confidentiality, competence and professional behaviour. Every accountant should follow these
principles in their professional role and should try to ethical in their overall approach. In case they
fail the accountants should be held liable on legal terms (Abdullah & Said, 2017). Now if the
accountants manipulate the data of the financial statements than that is not consistent as a member
of the accounting profession. Because manipulation of data will signify that the accountant is not
following the code of ethics. For example, the accountants in case they are making assumption in
preparation of their financial statements needs to disclose that in their notes to accounts so that the
users are aware of the same. This is as per the IAS 8 Changes in Accounting estimates and methods,
the accountants have to give disclosure related to that however what we see is that on many
grounds the accountants tend to manipulate the data and not give any proper disclosure in their
statements and that is against the code of ethics that they need to follow as per the ACCA. They
need to be competent in their approach, need to work with integrity and maintain confidentiality of
the client’s information. As per the ACCA it is mandatory that the accountants need to maintain their
integrity and professionalism when they are dealing with such data and when they manipulate it to
match the relevant accounting standard then they are going against the ethical approach that they
should have followed on many grounds. We see that sometimes the accountants have to manipulate
the data to comply with some of the accounting standards and accounting methods, as we see in
case of rule based accounting and so we see that even that is not correct, thus accountants should
be given flexibility in their approach of accounting till the time they are being ethical in their overall
approach and are doing their job as a responsible member of the accounting profession (Borit &
Olsen, 2012).
ACCA is one of the primary body that helps in formation of rules and regulations for the
management of the law and regulations that would help in governing accounting and audit. It helps
in setting up rules and regulations that accountants need to follow when they are preparing their
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