The handling of confidential information and sensitive data is a daily occurrence in accounting. The numbers you crunch directly affect bonuses and stock prices. Facing ethical issues in accounting is not uncommon. Conflict of interest, confidentiality issues, or fraudulent practices are typical dilemmas you may face at some point in your accounting career. You must handle these situations like an accounting professional and make the proper choices to address these issues appropriately. The following are ethical problems that you will likely face at some point in your accounting career.
In accounting, you must report financial situations correctly. However, you might find yourself being pressured by an employer to manipulate figures if the business is not doing well. Complying with your employer can put a permanent end to your accounting career while opening the door for civil or criminal liability. Do not give in to your employer, even if it may cost you a job.
There are times when certain information may cast doubt on the financial stability of a company. You might face the temptation to leave this information out of a financial report. Sure, omitting information is easier than manipulating numbers, but it is still illegal. Accurate financial information is essential for business owners to run their companies effectively. Furthermore, investors rely on accurate data to establish a precise assessment of the risks involved. Remember that you can and will be held liable for information withholding.
There is a chance that you will experience the temptation to improperly use the private information that you work with for significant amounts of time. You might even be encouraged to use confidential information to capitalize on an expected growth or drop in company stock. Avoid participation in these practices. The failure to protect private information or use this information for personal gain is unethical and illegal.
Conflict of Interest
Conflict of interest is a delicate area in which it is often challenging to identify problems. Let us say that you receive bonuses based on company stock price. You might be motivated to make business decisions that will result in higher stock prices. Of course, a decision like this is not in the company’s best interest in the long term. Take the time to consider conflicts of interest. It will lessen the chances of related problems coming down the road.
Understanding when to blow the whistle on a company that is manipulating or misstating its numbers is challenging. If your evidence builds a strong case, the company can lose value or even fail. The process will hurt your co-workers, the owner and the investors. The result for you could be intimidation, backlash, or you might develop a reputation as a menace. All of this can influence your accounting career, but it is best if you do the right thing and take the moral high road.
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