Ethics – the only way is the right way!

A recent article by Chartered Accountants Worldwide notes that “A Chartered Accountant’s training imbues them with values and ethics that help them to resist external pressure and to do the right thing at all times.”

As Chartered Accountants (CAs), we should always live by a set of core values that motivates us to do the right thing, and be vigilant and accountable always. This grounding becomes increasingly important given the ethical challenges facing a Chartered Accountant, as the person who must deliver the business results. If the business isn’t delivering what it hopes to achieve, then there might be pressure to make them look better than they are. The situation is more complicated because of the subjectivity involved in preparing financial statements. There is pressure to reflect positive results, so a CA is always under pressure to produce favourable results. It is important for CAs to stick to the code of conduct and behave in an ethical manner.

Ethical questions aren’t limited to presenting financial results. Tackling difficult situations calls for strong character as a business leader. You need to be able to say no, you need to be able to ask tough questions and make difficult decisions - and you need to do what is right. Chartered Accountants must uphold the values they learn during their training. They have a responsibility and integrity to upkeep…It’s important to have this inner compass to be true to this belief and be able to overcome the pressures from the other people who expect us to compromise on this integrity.

To learn more, read the article “The only way is ethics: how Chartered Accountants can steer firms the right way” and listen to the YouTube videos presenting what other CAs have to say about ethical matters. Also, refer to previous blog postings on “ethics and professional judgment.”

Critical success factors for tomorrow’s business leaders: Perspectives from the UK

The latest report from Chartered Accountants Worldwide has called for business to instill a culture of ‘moral courage’ from the boardroom downwards. In Critical Success Factors for Tomorrow’s Business Leaders: Perspectives from the UK, the international body states that social media and the 24-hr scrutiny of the digital age mean that there is a direct link between ethics and value creation that business needs to acknowledge.

The report follows the latest Chartered Accountants Worldwide Critical Success Factors Summit in London. The summits gather senior CEOs, CFOs and executives, together with the heads of global Chartered Accountancy bodies, to discuss key issues facing future finance professionals. The report covers issues ranging from geopolitical tensions to the need for tax simplification and also draws on research surveying chartered accountants leading UK businesses.

According to Pat Costello, Chairman of Chartered Accountants Worldwide: “The digital age means that everyone is under scrutiny, all of the time, and issues can escalate through social media like wildfire. The right decisions need to be taken in real time – it’s no longer enough to rely on the traditional hierarchies. This means we need to foster a culture where people are trained to know what the right thing to do is when a challenge presents itself. A culture of ethics certainly starts in the boardroom, but it can’t stop there.”

A Process for Professional Judgment

The initial post About this Blog on June 18, 2011 states: “Judgment defines a profession! In fact, the ability to make good judgment calls is paramount to the success of any professional. For Chartered Accountants (CAs), sound “professional judgment” is based on ethical behaviour together with an appropriate foundation of technical skills and critical thought processes, sustained and enhanced by professional development.”

It also states: “Professional judgment requires a commitment to gather all the pertinent facts, the discipline to examine the fact patterns in relation to a consistently-applied framework, and the willingness to consider alternative positions. In addition, it requires the application of relevant knowledge, expertise and practical experience in selecting a rational course of action.” 

In August 2014, the US Center for Audit Quality (CAQ) published a Professional Judgment Resource that is entirely consistent with this view of professional judgment. The CAQ is an autonomous, nonpartisan public policy organization dedicated to enhancing investor confidence and public trust in the global capital markets. The CAQ fosters high quality performance by public company auditors, convenes and collaborates with other stakeholders to advance the discussion of critical issues requiring action and intervention, and advocates policies and standards that promote public company auditors’ objectivity, effectiveness and responsiveness to dynamic market conditions. Based in Washington, DC, the CAQ is affiliated with the American Institute of Certified Public Accountants (AICPA).

Chartered Accountants Worldwide: business leaders, decision-makers and trusted advisers

Chartered Accountants (CAs) were the founders of the accountancy profession and have led its global development. Today, they hold influential positions around the world as business leaders, decision-makers and trusted advisers. In over 180 countries, CAs have attained and maintained the top professional standard that this status demands.

CAs have been a mark of excellence across all aspects of business and financial life for over 150 years. They advise organizations, lead major companies, shape economic policy and deliver effective financial management and reporting. Talented, ethical and committed professionals have never been more highly valued. By combining unrivalled knowledge, skill and commitment, CAs enable businesses, organizations, individuals and communities to achieve their financial and strategic goals with rigour, integrity and vision.

The leading institutes of Chartered Accountants from around the world have come together to support, develop and promote the vital role that Chartered Accountants play throughout the complex global economy. They include the Institute of Chartered Accountants in England and Wales (ICAEW), the Institute of Chartered Accountants of Scotland (ICAS), the Institute of Chartered Accountants Australia (ICAA), Chartered Accountants Ireland (CAI), the New Zealand Institute of Chartered Accountants (NZICA) and the South African Institute of Chartered Accountants (SAICA).

To learn more about this initiative, browse the new website “Chartered Accountants Worldwide.” In addition, review the 87-page publication Chartered Accountants Worldwide: No ordinary business minds. For further information, contact: info@charteredaccountantsworldwide.com.