AICPA Code of Professional Conduct - Essay Example

AICPA of Professional Conduct AICPA of Professional Conduct One thinks that one of the most important purposes of the AICPA Code of Professional Conduct is its setting forth of guidelines for accounting professionals regarding the ethical principles and rules of conduct of its members. Like in any other profession, individuals must be guided by certain rules of conduct to maintain the integrity of their profession. Having a code of conduct for accountants will earn respect for them. If people know that they are guided by a code of conduct, they are assured that they will perform their duties within the highest standards of professionalism.

Furthermore, a code of conduct for accountants would mean that they always put the stakeholders’ welfare above their own personal welfare. It will not only benefit their clients and employers, rather, it will benefit the public. If accountants act according to a code of conduct, people are assured that they are giving accurate information. The public relies on accountants to give truthful data on a company’s performance and on this basis; they may decide to purchase or sell stocks of corporations.

The stock market’s performance is based on the financial pictures presented by companies, which rely greatly on their accountant’s credibility. It therefore follows that the status of the stock market, which forms part of the economy of a nation, may be dictated indirectly by accounting reports created by accountants. If these accountants do not have a code of conduct, then the reports that they will give out will be questionable and may not be a valid basis for investment decisions. Another important purpose is to support and improve the accounting profession (Bradford, 2008).

Through its various activities, AICPA is able to assist accounting professionals in the conduct of their duties and responsibilities. Their publications provide accountants with the latest issues in accounting and in the other fields of business. Aside from the publications, AICPA also requires its members to pursue continuing professional education to keep them updated with recent developments in their profession (Bradford, 2008). Support for any profession is essential. In this manner, they can also police their own ranks.

Anyone who does not follow their code of conduct may be pressured by members of AICPA to perform their duty well. This purpose is important because if people of the same profession group together, their association can be a venue where they can raise problems with regards to their profession. They can also serve as one voice in issues relevant to their profession. The third most fundamental purpose of the AICPA is to assist in the formulation of the technical standards for CPAs (Bradford, 2008).

This is very important because if there will be no technical standards for CPAs, then every accountant will have his own way of making his own rules and financial statements. It would then be difficult for readers of accounting records or financial statements to assess the true picture of a company. The stakeholders of companies will not see the real performance of their corporations. Investors will find it complicated to make investment decisions based on reports of the accountants. Analyzing the financial picture of companies will be quite a challenge for financial institutions such as banks because evaluation of the figures cannot be backed up by standard accounting procedures.

Approval of loans will therefore be tough for financial institutions. It might also jeopardize the whole banking industry if accountants of companies use their own accounting procedures. References Bradford, T. (2008, June 9). What is the AICPA? Retrieved May 25, 2012, from suite101.com: http://suite101.com/article/what-is-the-aicpa-a56505