Ethical Dilemmas and Challenges for Accountants in Profession

This essay analyzes ethical dilemmas faced by accountants, focusing on the International Federation of Accountants (IFAC). It explores how these dilemmas affect individuals, stakeholders, and organizations, examining issues like corporate ethics failures (Enron, WorldCom) and the impact of regulations (Sarbanes-Oxley Act). The essay discusses stakeholder theory, ethical awareness, and the influence of professional judgment, as well as challenges such as skill gaps, pressure from increasing demands, and the need for ethical behavior. It also highlights internal conflicts and safeguards like seeking advice and maintaining confidentiality. The study addresses specific ethical threats including self-interest, self-review, advocacy, familiarity, and intimidation, while suggesting measures to resolve them. The essay examines ethical culture, ethical accounting practices, and business issues like security and bribery, offering guidance and frameworks for accountants to address these challenges. Overall, the essay emphasizes the importance of ethical conduct in the accounting profession and provides insights into navigating complex issues and promoting public interest.

Running head: ACCOUNTANTS IN THE PROFESSION
Accountants in the profession
Name of the student
Name of the university
Authors note
Introduction

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The study assignment provides information about three articles related to the
international federation of accountants (IFAC). The main focus of this process is to serve the
public interest, improve the accounting process and contribute to the overall development of
the organisation. Therefore the study topic describes three ethical dilemmas from three
articles. Apart from this how these ethical dilemmas can affect the individuals, stakeholders
and key organisations. These ethical issues can well affect the overall fundamental rights and
obligations related to these fundamental principles.
On the other hand in the second part, the study discusses about two sustainability
challenges which are affecting the overall process and how to cope up with these issues.
Discussion
PART A: Ethical Dilemmas – Issues and Solutions
In the first article diversified role of the professional accountant in business have been
discussed by international federation of accountants. The overall mission of this process is to
serve the public interest, develop strong accounting connection between organisations,
industry, public and private sectors. Furthermore they always encourage the professionals to
develop knowledge and introduce best practises. However the theory also addressed certain
ethical issues or dilemmas. These issues are very much familiar with the accounting concepts
(Khan et al 2016).
The ethical issues addressed in this article define that in most of the cases the
accountant has been held responsible for the collapse of these companies. However cases like
Enron, WorldCom have occurred owing to the failure in maintaining the corporate ethics in
accounting (Strand 2014.). Therefore the recent Sarbanes- Oxley act has introduced certain
aspects to handle the accounting fraud from happening again. However all these cases have
affected the shareholders, parties and individuals. The share prices of this company have

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degraded to a massive amount. Thus ultimately the companies had to stop their operation.
Therefore from the first article it is seen that political parties always have approached the
business and contributed thereto. But federal governments have also supported to takeover
community projects rather than ensuring support to those parties. As per van Leuwen,
different sectors face different issues. Further there are the peoples from entry level who seek
to earn the accounting rules and regulations related to the ethics and integrity (Lozano 2015).
The second article discuses about relevant stakeholder’s theory along with their
ethical awareness and behaviour. Hence the overall behaviour of the finance profession has
been cross- checked effectively both by the internal and the external stakeholders. Therefore
the finance professionals are very much aware of the ethical behaviour in the workplace.
Thus as per the surveys conducted almost 81 percent of the respondents have said that
demonstration of these ethical behaviours are highly affecting their performance and
restraining them from performing their duties. Most importantly these aspects are reflected
across the regions and sectors overall.( Edgeman et al 2015)
As per this graph it is seen that the financial professionals are highly affected in this
way. Therefore the accountants in this case can exercise the professional judgements.
Although the process is highly rules based rather than principles based. Thus the research

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suggests that the importance of existing sound professional judgements which could remain
and could turn out to be more important in the near future (Engert et al 2016.).
Further the focus is on the behaviour of accountants which could be heavily affective
to the management. Thus the focus is shaped on the fact that the financial stakeholders hold
interest in the financial interests in the overall financial performance of the organisations.
Thus the process has created wider and easier process to the stock markets. Thus it leads to
increase in the transparency to the business. Further in order to safeguard the interest a
response is collected to impose greater regulations and compliance to the financial activities
of the companies. Hence these regulations does not only restrain from the need to exercise the
overall professional judgement or to behave like an activate professional. Thus this topic
states that the increasing business complexity has continued to drive the force towards need
of accountants. Further effective judgement and overall transparency in this process.
Similarly there is also a need for the accountants to behave ethically and continue their
operation abiding the rules and responsibilities of the organisation. Further these findings
also state that the finance personals are not using their skills as effectively as they could have.
Therefore the training facility and intellectual ability of the accountants make those
judgements as one of the key assets. Furthermore the overall routine transaction oriented
tasks needs to be automated or otherwise can be assigned to the overall experienced
candidates (Benn et al.2014).
Apart from this aspect it can also be said that the implication of increased cross-
checking, high end user expectations and evolutions of the processes are also increasing the
pressures which the financial professionals are likely facing. Overall the surveys reveal that
almost 86 percent of the respondents have claimed that the overall increased demand are
putting pressure to the work finance undertaken within the company. Further 86 percent of
respondent had claimed that increasing pressures on the workplace are very much equivalent

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to the overall accounting areas. Moreover 83 percent respondents have claimed that the
public figure could represent the discounted findings and the remedies related to the process.
Particularly the new productivity techniques could enforce new attractions rates and overall
productivity (Wolf 2014.).
Further as the roes of the accounting professionals change and then skills get to
evolve, further there is a gap between skills and the organisational skills sets. There are two
reasons on why such gap exists. This are-
 A general shortage of professional accountants is seen currently.
 The accountants do not meet the required skills to fill this gap.
 The shortage of accountants is caused by a number of reasons.
Firstly there is a demographic shortage in many countries like Europe, North America
and other parts of Asia where there are fewer amounts of graduates. Therefore the companies
can face ethical issues if they select those candidates who do not possess the required
alignments. Hence this skill deficit can be effective to some extent to the big organisations.
Furthermore these skill deficiencies are considered as biggest problems. Treatments required
for the new legislations and to curb down booming economy by implementing new and
improved techniques (Baumgartner and Rauter 2017.).

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Respond to the ethical challenges of ethics
Most of the accountants in the business and public sector face ethical dilemmas
during their professional careers. Hence these issues form in the way of supporting the
challenging complexities (Mass et al. 2016). Further the accountants may like to treat these
issues as business decisions rather not to utilise the professional codes to assess the potential
course of actions. Therefore the challenges faced in this case are as follows-
Ethical culture
The recent conducted survey has shown a 10 to 15 percent increase since 2008
relating to the ethical issues, training and provisions for hotlines, incentive makings and
rewards based on performance.
The corporate leadership is less activated and engaged in reviewing the organisational
performance. The corporate leaders held responsibility related to the business ethics. Thus the
leadership implies ethical operational culture related to the organisations.
Ethical accounting
The survey further shows that there is almost 20 percent increase in organisation by
further collecting the ethical information. Therefore the management feels that it is needful to
collect and analyse the ethical information.
Ethical issues and pressure
However due to the increase in the ethical codes, there is extreme pressure within the
organisations to act unethically. Thus pressure appears to be appearing for emerging
economics (Ioannou and Serafeim 2017).

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Business issues
The security information remains as the biggest issue of concern across all the market.
Thus the bribery has risen from the concerned issues. Therefore the anti-bribery and
corruption legislative process is formed.
However the IFAC members provide guidance, ethical resolution framework and
ways which can help the accountants deal with these issues.
A common aspect of guidance on resolving the ethical issues that can help the
accountants define and apply for the principles related to the professional code of ethics.
Therefore these ethical issues can act for the beneficiaries of public interest and professional
ethics. It places expectation to the accountants so that they can regulate the process by their
own.
This ethical issues are broadly threatened by the range of circumstances, self –
review, familiarity, advocacy etc.
There are certain threats which are faced by the professional accountants in this
regard. These are as follows-
Self-interest
As per the article these kind of threat occurs if any financial matter occurring in the
organisation goes against the interest of these professional accountants. Further these closed
family member interest is another process which sometimes faced by the professional
accountants. For example having a close relationship with the clients can be considered here
(Siew 2015).

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Self- review
This situation occurs if a previous financial report is re- evaluated by the professional
accountants. Therefore if a professional accountant is held responsible for this judgement,
then these kinds of threats may come into existence. For example- reporting of the financial
system after involving the implementation.
Threat of advocacy
This kind of situation occurs in case of the professional accountants, if they
compromise the opinion of the extensive position relating to the financial manner. Therefore
the professional accountant has the opportunity to argue for previous financial position. For
example listing shares for promoting an entity and later on the entity is found to be guilty for
using the statements of his clients (Peters and Romi 2014).
Familiarity threat
It is another situation which is often faced by the professional accountant. Thus as per
IFAC guidelines the accountants are seem to be sympathetic to their close relatives who are
quite used to this process. For this case the professional accounts needs to be favourable to its
close members. For example an employee is in the position to exercise the overall influence
over the subject matter of this engagement (Ihlen and Rope 2014.).
Threat to intimidation
Lastly the intimidation threat is also considered in this aspect. For this aspect the
professional accountants may think about some kind of threats which are directing affecting
the achievements of the company in a negative way. However this situation may or may not
affect the professional accountants, but surely it is a threat to the company accountants. For
example the dismissal in related to the client engagement (Formentini and Taticchi 2016)

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Safeguards to these issues
Internal conflicts
The internal conflicts are directly related to the accounting policies and procedures.
Therefore some measurements needs to be taken in this case. These are as follows-
 The accountants need to take advices from the employer, professional entities or other
professional advisors who are associated with this field for a long time.
 The employer is providing a formal disruptive resolution process(Grimm et al 2016).
 Lastly the accountant’s needs to ensure that the advices they are getting are legal
(Bansal and Song 2017).
Reporting of information
Accountants must prepare the information fairly and with honesty. However the
accountants can be sued for providing misleading information. Therefore the accountants can
keep themselves safe in the way of –
 Accountants can consult with the seniors of the company to resolve any issue.
 Consulting with the governing body is also a good option for them.
 The professional governing bodies can also be helpful to resolve problems.
Keeping confidential information
There are often some information’s which are kept confidential by the company
officials. These information’s are only accessible from the end of employees. Further the
accountant may be in a lot of pressure to disclose those information as a compliance with the
legal process such as anti- money laundering or act of terrorism. Thus these conflicting
situation could create a bad situation for the professional accountants. Therefore in order to

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solve this issue, the management needs to disclose the information complying with relevant
stakeholder theory, money laundering and other regulations (Klettner et al 2014).
Whistle blowing
Whistle blowing in auditing is an aspect which is given negative social attributes to
the whistle blowers and informers. This in general can be more harmful to the professions
and other individual practitioners. Therefore a recent published general purpose definition of
whistle blowing is provided. It states that it is a disclosure which expresses ethical dilemma
of diversified loyalty. This is highly related to the property rights of the organisation. Further
it also argues that the internal audit disclosures which are arising from these dominant
external statutory audit does not qualify as the case maybe.
PART B: Sustainability – Challenges and Solutions
The sustainability reporting is one of the most important topics currently. Almost each
and every company tries to implement sustainability accounting within the companies.
Further in attention to the social, environmental and the other economic factors relating to
business performance will be increasing from the investors, accountants, governments,
customers and the society in general. Therefore as a result the professional accountants in the
business will be taking an active part in implementing sustainability in the business. Thus
tom help the business, the professional accountants and IFAC committee have published two
different report where the information’s are kept.
Therefore in the first article the interview conducted from senior accountants
associated with various enterprise around the world have imposed new challenges in
promoting and implementing the sustainable developmental strategies. Thus it can be said
that the sustainability will vary based on the organisation employed according to the nature of

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the job. Thus the significant agreement between the processes regarding this field will be
helping to implement and exercise their job roles in a positive way.
Furthermore these two articles will be helpful to promote the professional accounting.
Since in the current era, sustainability is an important topic, therefore it will help to increase
agendas of the business. Therefore the aim of this aspect is develop and exchange the
knowledge and other best practises. The IFAC is a worldwide organisation that deals with
professional accounting in order to serve public interest by strengthening the profession and
contributing towards the overall development of the business. Through the help of accounting
bodies serving for the sake of public interest, education, government service, industry and
commerce overall. In this way they ensure corporate sustainability and ethics by maintaining
the performance relating to the professional standard.
Therefore there are certain sustainability challenges which are directly related.
Sustainability in professional accounting is major step. Therefore the corporate are
highly responsible to enforce sustainability within the accounting. These includes risk
management, capital productivity innovation and growth.
Thus as per the overall sustainability business reporting related to the upcoming
challenges and solutions, it can be said that finance takes a greater part for protecting and
strengthening the foundations for a long term process. Since it is related to the companies, the
rise in such reporting will directly affect the company stakeholders seeking more information
from the business and respond to the social matters. Further the customers make decisions on
how the environmentally and friendly economical companies are. Apart from this the
investors are serious about the company’s sustainability and expect that they will cut cost
when needed. Thus the main benefits are discussed below-

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Risk and uncertainty in technological innovation
The public sector organisations in the accounting and finance filed is acting on the
behalf of community. Further they can accept projects in the private sectors also. Since more
amount of capital is involved, therefore project duration is also high. Risks are also high at
the same time. The new process discovers and invents new technologies for a clean and safe
accounting and production process. These circumstances encourage the development of the
sustainability accounting in public sector accounting.
Again on the other hand the process which are developed by the accountants
introduce the accounting systems which provides information about certain ecological and
other social risks simultaneously. Thus such measures may be recorded in the physical terms.
Considering an example of this case will be of Australia where half of the accountants are
trying tom implement new ways so that the sustainability reporting becomes easy to describe.
It further assesses the ecological benefits, possible risks and the other factors related to the
business and sustainability accounting.
Solutions
Provide accurate information
The accountants can help to improve the company communications with its
stakeholders by innovating the overall process. For example use of integrative reporting
framework for disclosing the relevant financial and non- financial reporting standard.
Therefore this involves focusing on the matters by linking the financial aspects.
New public management and financial sustainability
The articles further provide insights on new public management and financial
sustainability accounting within the business. The new pubic management has brought