CH 29 TITLE
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
CH 29 BACK NO TAB
The accounting profession requires itsmembers to follow a code of ethics.
main idea graphic
Glencoe Accounting
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
CH 29 BACK NO TAB
Explain the meaning of ethics
Describe the components of business ethics.
Identify the role of the accountant in business ethics.
Discuss how ethical behavior benefits individuals, businesses, andsociety.
Explain the key principles an accountant is expected to follow.
Identify the accounting organizations that establish codes of ethics forthe profession.
Describe the Sarbanes-Oxley Act.
chapter objectives graphic
Glencoe Accounting
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Key Terms
ethics
business ethics
code of ethics
ethics officer
The Nature of Ethics
Section 29.1
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
The Nature of Ethics
Section 29.1
1 long box
Business ethics are not very differentfrom ethics in general.
ethics
The study of our notions of right and wrong;a set of basic principles.
Before You Read_wt
Ethics
business ethics
The policies and practices that reflect a company’score values such as honesty, trust, respect, andfairness.
Before You Read_wt
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
The Nature of Ethics
Section 29.1
Ethics
5 boxers from 1
How are businessethics determined?
The Law
Company Values
Training and Outreach
Ethics Committees
Enforcement
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
The Nature of Ethics
Section 29.1
1 long box
What is a code of ethics?
code of ethics
A formal policy of rules and guidelines that describes thestandards of conduct that a company expects from all its employees.
Before You Read_wt
Ethics
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
The Nature of Ethics
Section 29.1
Ethics
2 boxes from 2
Training andOutreach
Distribution of awritten code
Formaltraining
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
The Nature of Ethics
Section 29.1
Ethics
3 boxes in 1 news
EthicsOfficer
Creates Programs
Evaluates Performance
Enforces Standards
ethics officer
The employee directly responsible forcreating business conduct programs,evaluating performance, andenforcing standards of conduct.
Before You Read_wt
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Ethics
The Nature of Ethics
Section 29.1
5 pie
Enforcement
PerformanceAppraisal Notes
Probation
Suspension
Demotion
Termination
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Ethics
The Nature of Ethics
Section 29.1
4 boxes under one
The Accountant’s Role
Avoid harm to stockholders.
Optimize the interests of the public.
Adhere to universal standards of what is right.
Respect the human rights of all people.
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
4 boxes to 4 boxes
Ethical Behavior
The Nature of Ethics
Section 29.1
Individuals
Businesses
Society
Acting ethically can increase self-esteem, contentment,and self-respect.
A DePaul University study found that companies thatmade commitments to an ethics code provided twicethe value to shareholders than those that did not.
Society is the sum of all social relationships betweenhumans and is only as ethical as the individuals andbusiness that make it up.
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Key Terms
integrity
objectivity
independence
competence
confidentiality
Ethics in theAccounting Profession
Section 29.2
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Key Principles
Ethics in theAccounting Profession
Section 29.2
5 pie
KeyPrinciples
Integrity
Objectivity
Independence
Competence
Confidentiality
integrity
The principle that
requires accountants tochoose what is right andjust over what is wrong.
Before You Read_wt
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Key Principles
Ethics in theAccounting Profession
Section 29.2
5 pie
KeyPrinciples
Integrity
Objectivity
Independence
Competence
Confidentiality
objectivity
The principle thatrequires accountants tobe impartial, honest, andfree of conflicts of interest.
Before You Read_wt
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Key Principles
Ethics in theAccounting Profession
Section 29.2
5 pie
KeyPrinciples
Integrity
Objectivity
Independence
Competence
Confidentiality
independence
The principle thatrequires accountants tohave no financial interest inthe company being audited.
Before You Read_wt
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Key Principles
Ethics in theAccounting Profession
Section 29.2
5 pie
KeyPrinciples
Integrity
Objectivity
Independence
Competence
Confidentiality
competence
The principle that requiresaccountants to have theknowledge, skills, andexperience needed tocomplete a task.
Before You Read_wt
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Key Principles
Ethics in theAccounting Profession
Section 29.2
5 pie
KeyPrinciples
Integrity
Objectivity
Independence
Competence
Confidentiality
confidentiality
The principle that requiresaccountants to protect andnot disclose informationacquired in the course ofwork unless they have theappropriate legal orprofessional responsibilityto do so.
Before You Read_wt
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Codes of Ethics
Ethics in theAccounting Profession
Section 29.2
3 circles
AmericanInstitute ofCertified PublicAccountants
Institute ofManagementAccountants
Institute ofInternalAuditors
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Sarbanes-Oxley Act
Ethics in theAccounting Profession
Section 29.2
3 boxes with header
Sarbanes-Oxley Act (SOX)
Effective 2002, SOXprotects investors afterseveral corporatescandals failed to beidentified and preventedby auditors.
SOX requires CEOs,financial officers,accountants, andauditing firms to complywith new regulationsand procedures.
SOX established anaccounting board tooversee and investigatethe audits and auditorsof public companies.
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Question 1
What are five items that could be included in a business’s code of ethics?
Conflicts of interest
Product quality and testing
Customer relations
Employee relations
Suppliers and consultants
Expense reports
Security
Political contributions
Environmental actions
International business
Workplace safety
Technology
Whistle-blowing
Answers can include:
CH 29 BACK WITH TAB
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.
Glencoe Accounting
Question 2
What is the foundation for ethics in accounting?
Certain principles provide the framework for rules of conduct thatan accountant is expected to follow. The principles include integrity,objectivity, independence, competence, and confidentiality.
CH 29 TITLE
End of