2022-2023 Ethics for Washington CPAs
Author: Allison McLeod
| CPE Credit: |
4 hours for CPAs |
Accounting scandals. Embezzlement. Fraud. “Taking the easy way out.” All too often we read these words in the paper or hear it on the evening news. Most of the tales tell of the failure by individuals in their fiduciary duty to properly handle, manage and/or report company assets and operations.
Values. Ethics. Integrity. Morality. Principles. Courage. “Doing the right thing.” Far more rarely reported are stories of those who are not only steadfast in their values, but also take action to right a wrong, despite the many factors that can pull an individual in many directions. Greed, management pressure, fear, and expediency are some of the many different aspects that divert an individual from a righteous path to the slippery slope of moral compromise.
In an era of some managements’ over-focus on analysts’ expectations and pressure to meet profit and loss targets, there are unfortunately many examples of cutting corners and so-called “earnings management” which later are labeled by the action’s real names: unethical behavior, criminal activity and fraud. In certain cases, the accountants become complicit, either wittingly or unwittingly, in the scandal.
How is a Certified Public Accountant (“CPA”) expected to navigate such treacherous shoals?
The following course material is designed to assist the CPA in learning how to manage the ethical challenges that arise in today’s work environment. We will examine in Part I the basic ethical philosophies and values that individuals rely on to determine which actions are right and which are wrong. Part II will review the various guidelines, such as the AICPA Code of Conduct and the Washington Public Accountancy Act, to which CPAs must adhere. After covering rules, thoughts and philosophies, Part I and II can assist the CPA in determining the rightness and wrongness of an action, Part III will discuss ways in which individuals can improve their chances of behaving ethically. Woven throughout the material are various real-world case studies to illustrate various points.
Publication Date: December 2022
Topics Covered
- Part I: Ethics, Morals and Values
- Case Study: Student Suspended After Saving Life
- Case Study: Officer Robert Powell
- Case Study: Sinking of the Royal Charter
- Part II: AICPA Code of Professional Conduct
- Case Study: Auditors Cheating on Qualifying Exam
- Case Study: $40m Embezzlement at Yale Med School
- Case Study: Henry Camferdam
- Case Study: The Vengeful Tax Preparer
- PART III: Washington State Specific Rules
- The Washington State Board of Public Accountancy; Use of Titles; Licensing
- Confidentiality; Client Records; Acts Discreditable
- Case Study: Stealing Lunch Money
- Responsibility to the Public
- Case Study: Rose Valland
Learning Objectives
- Recognize licensees responsibility in ethics of professional accounting as CPAs
- Recognize the intent of the AICPA Code of Professional Conduct, the Washington Administrative Code and Washington Public Accountancy Act in the performance of professional accounting services/work, not to adhere to the mere technical compliance of such rules
- Identify how the CPA should apply ethical judgment in interpreting the rules and determining public interest
- Identify the AICPA Code of Professional Conduct and the Washington Administrative Code and Washington Public Accountancy Act
- Describe the implications for persons in a variety of practices
- Identify the Washington Statutes and Rules that pertain to CPAs licensed to practice in the state of Washington
- Recognize the Washington Administrative Code and Washington Public Accountancy Act currently in effect and how the statutes, rules, and policies pertain to them
- Identify the three major normative ethical schools of thought
- Recognize the action of ethical schools of thought
- Describe what contributed to the mortgage crisis during the Great Recession of 2007-2010
- Identify the main steps a CPA should apply as it pertains to threats to independence
- Recognize what is included under WAC 4-30-046, due care principle
- Recognize when ethical conflicts arise
- Identify signs that an organization is on the verge of an ethical collapse
Level
Basic
Instructional Method
Self-Study
NASBA Field of Study
Regulatory Ethics (4 hours)
Program Prerequisites
None
Advance Preparation
None
