What Are the Principles of the Aicpa Code of Professional Conduct?

What are the principles of the AICPA Code of Professional Conduct?

The AICPA Code of Professional Conduct presents six principles of ethical conduct. The first of them being the responsibility of the CPA to carry out duties in a professional manner, as well as exercise good moral judgment. Second is that there is an obligation to work in the interest of the public and honor the public’s trust through their commitment to professionalism. Next, in order to maintain that trust, one must act with the highest sense of integrity. By doing so, they are able to free themselves of conflicts of interest and view all of their works with independence and objectivity. CPAs are required to adhere to technical and ethical standards and strive to provide services to the best of their abilities; due care. Lastly, one who is serving the public should determine the scope and nature of the services to be provided (Boynton & Wiley, 2006).

What part(s) of the AICPA Code of Conduct was violated by Andersen? Andersen violated many aspects of the AICPA Code of Conduct when conducting audits for Enron. Some of the biggest violations were the responsibility to public interest and integrity. Andersen knew early that there were huge misstatements in Enron’s financial statements, but failed to have them corrected or to report Enron. This could have stopped the fraud early on and help reduce the amount of losses for investors and the public. Andersen also violated Rule 203 - Accounting principles in the Code of Conduct by putting a “stamp of approval” on Enron’s financial statements even though their income was overstated by almost 50%. They were not following auditing and accounting standards based on GAAP (Boynton & Wiley, 2006). Andersen’s unethical behavior continued when they destroyed important documents from Enron’s audit to try to cover up activities that had taken place.

By any Enron employee who was a CPA?

The AICPA Code of Conduct was violated by any Enron employee who was a CPA, just like they were violated by Andersen. Professionals are required to maintain the integrity of the profession, so when the CPAs of Enron knew things were not being done right at Enron, they should have stood up for the public’s best interest and should have stood up for their morals. Then Enron’s CPAs knew about the conflicts of interest between subsidiaries and upper management

...