Ethics and Professional Responsibilities for CPAs

Discipline: Ethics and Professional Responsibilities for CPAs

 

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Ethics and Professional Responsibilities for CPAs

The Code of Professional Conduct from the American Institute of Certified Public Accountant (CPAs) (AICPA) and the Code of Ethics from the International Ethics Standards Board for Accountants (IESBA) both prescribe a CPA code of ethics, addressing numerous standards of ethical behavior in the accounting profession. The IESBA establishes five key ethical principles for accountants. These are: integrity; objectivity; professional competence and due care; confidentiality; and professional behavior. The principles of CPA ethics can be summarized as committing to working at the highest level of one`s technical competency (that is, not taking shortcuts for expediency`s sake), not using or sharing confidential information for personal gain or to benefit another party and maintaining independence (avoiding potential conflicts of interest).

came to power in 1979 and represented for many, laissez-faire economics and individual self-determination (Steele, 2018). She believed in power of the market, utilizing it to restore the stagnant British economy and moving away from state provided services. In 1979, cuts resulted in reducing the standard rate of tax from 33% to 30%, the top rate from 83% to 60% and finally cutting public spending by 3% (Bolick, 1995). She reduced the amount of public spending, from 50% to 43%. Thatcher felt high taxes discouraged the incentive to work however, effects of tax cuts increased income inequality through as high earners saw ‘the top 10%- did far better, with their incomes increasing from the equivalent of £472.98 in 1979 to £694.83 in 1990’. The uneven distribution of wealth saw the poorest families receive the least. Reductions in public expenditure affected health, education and social services which created a knock-on effect with substantial loss of public sector jobs resulting in decreased spending on goods and services. Privatisation became Thatcher’s most important and long-lasting legacy. She revealed in her memoirs that it was crucial for ‘reversing the corrosive and corrupting effects of socialism’ Parker. In the 1980-90s, due to fiscal pressures, Thatcher’s conservative views on private ownership and public discontent with the current regime saw the privatisation of public owned entities. For example, the sale of just ‘over 50% of shares in BT and the sale of British Energy in 1996’ (Berrington, 1998). Other privatised industries included electricity, gas, British steel, public bus transportation and other public services. As a result, workforces declined as ‘employment in the electricity and gas industries was cut in half’(Edwards, 2017), problems arose in the regulation of private monopolies to prevent abuse of power, however improved ‘economic growth and improved living standards as privatised businesses cut costs, increased service quality’ (Edwards, 2017). Thatcher can be seen as the key instigator of the sweeping shift from traditional to ‘New Public Management’ initiated by public service reforms. NPM involved the adoption of private sector management ideas to improve structures and processes in the public sector. Thatcher who led the 1980s ‘New Right’ administrations, that put a ‘shrinking government and reduced taxation on the agenda’ (Ferlie, 2017). Thatcher also wanted to remove ‘inefficiency in the state bureaucracy and the deprivilege of the civil service’ as she concluded that the public sector was ‘wasteful, overbureaucratic and underperforming’ (Ferlie et al., 1996). Thatcher wanted to identify areas of waste and inefficiency in the government and ‘improve service quality and customer-orientated service’ (Pollitt, 1996) whilst reducin

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