...Ethics Audit Questions April Whitehead HSM/230 February 1, 2015 Erin O'Brien Ethics Audit Questions Board: Does the board let each member know what is expected of them? This is crucial because it is pertinent for all employees or board members to know what is expected from each of them individually and as a whole. All tasks, or projects, must be clear so that the members know exactly what goals to work towards and that will also improve staff performance and in turn the organization as a whole. Staff: Does the staff members show good partnership skills (being able to work on a team)? It is crucial for all staff members to be able to work with one another. This not only helps the staff to work together as a whole toward common goals, but it also allows the organization to operate more smoothly. If staff members cannot work together, then they cannot communicate efficiently and effectively and not only does the work environment suffer but the organization also suffers as a whole. Donors/Fundraisers: Are the donors aware and informed of all of the different ways that their contributions, or money, is helping the organization? Donors like it when the results of their donations are visible. Donors also like to see that they are helping the organization that they donate to. Donors should know, and like to know, what changes, improvements, or any other positive results have been made or completed because of their donations. They like to see how their money is being...
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...dari Kantor Akuntan Publik (KAP) Drs. Mitra Winata dan Rekan selama dua tahun, terhitung sejak 15 Maret 2007. Kepala Biro Hubungan Masyarakat Departemen Keuangan Samsuar Said dalam siaran pers yang diterima Hukumonline, Selasa (27/3), menjelaskan sanksi pembekuan izin diberikan karena akuntan publik tersebut melakukan pelanggaran terhadap Standar Profesional Akuntan Publik (SPAP). Pelanggaran itu berkaitan dengan pelaksanaan audit atas Laporan Keuangan PT Muzatek Jaya tahun buku berakhir 31 Desember 2004 yang dilakukan oleh Petrus. Selain itu, Petrus juga telah melakukan pelanggaran atas pembatasan penugasan audit umum dengan melakukan audit umum atas laporan keuangan PT Muzatek Jaya, PT Luhur Artha Kencana dan Apartemen Nuansa Hijau sejak tahun buku 2001 sampai dengan 2004. Selama izinnya dibekukan, Petrus dilarang memberikan jasa atestasi termasuk audit umum, review, audit kinerja dan audit khusus. Yang bersangkutan juga dilarang menjadi pemimpin rekan atau pemimpin cabang KAP, namun dia tetap bertanggungjawab atas jasa- jasa yang telah diberikan, serta wajib memenuhi ketentuan mengikuti Pendidikan Profesional Berkelanjutan (PPL). Pembekuan izin oleh Menkeu tersebut sesuai dengan Keputusan Menkeu Nomor 423/KMK.06/2002 tentang Jasa Akuntan Publik sebagaimana telah diubah dengan Peraturan Menkeu Nomor 359/KMK.06/2003. Pembekuan izin yang...
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...Board: How are board members selected? Has specific criteria been established for selecting new board members? This is an important question to add to the audit because there should be a set list of criteria of what the board and the director are looking for when looking for new members. This way only the right people get the right job. Staff: How are staff members held accountable for their actions? Are there clear procedures for disciplinary action? This is an important additional audit question because all employees should be treated equally including when dealing with performance and disciplinary issues in the workplace. Clear policies would help guide managers in discipline to attempt to avoid favoritism, retaliation, or other unfair practices. This would ensure consistency. Donors and Fundraisers: If fundraising for a non-profit, are donors provided with the proper paperwork for claiming charitable deductions on their taxes? This is an important question to put on the audit if working with a non-profit organization. There should be consistent paperwork provided to donors for tax filing purposes. Clients/Customers: What is the policy on files of former clients? How long are files kept and are they properly destroyed? This is an important question to add because most of the questions are concerning current clients. There is a question about the confidentiality of clients but I do not think it covers or is clear enough about dealing with the confidentiality...
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...perform his work with utmost care and honesty. He must guide companies in disclosing everything required as per GAAP. The financial statements approved by an auditor must be accurate. In reality, an auditor comes across various situations where he can make unfair decision. In the presented case, though the company is willing to pay the auditor additional work for $700,000, the auditor must not get influenced neither by such offers for payments nor try to publicize his services to the company that is being audited as it could sway his judgment. An auditor’s ethics plays a vital role in such situations. The financial statements of a company must be unaltered and prepared in compliance with GAAP. These statements must provide right information and actual numbers. The company must not provide misleading information nor use the “cookin the book’s” technique to make financial statements look colorful to its investors and creditors. Ethics cannot be bought for money. Even if the company maintains a friendly relationship with the auditor and pays him well, it must not impair the auditor’s professional judgment. Any day, if the fraud is uncovered, both the company and the auditor will lose their reputation and face criminal charges. The auditor will be held responsible and comprehensively scrutinized. One such scandal was that of 2001, when Arthur Anderson involved in the fraudulent activities with its clients Enron and WorldCom. In the end, the two companies were declared bankrupt and the...
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...“Ethics Audit Benefits.” Please respond to the following: Compare (1) the benefits associated with conducting an ethics audit against (2) the challenges of measuring nonfinancial performance and the risks inherent in ethics auditing. Ethics audit is a systematic evaluation of an organization’s ethics program to determine if it is effective or not. Effectiveness of programs and polices can be improved and organization can identify potential risks and liabilities and can improve its compliance with the law (Ferrell, Fraedrich & Ferrell, 2011, pg.243-245). The ethics audit, like the financial audit, should be conducted regularly rather than in response to problems involving or questions about a firm’s priorities and conduct. The process of auditing and reporting a firm’s ethics programs is no guarantee that it will avoid challenges related its efforts. In addition, because this type of auditing is relatively new, there are few common standards to judge disclosure and effectiveness or to make comparisons. The auditing process can also demonstrate the positive impact of ethical conduct and social responsibility initiatives on the firm’s bottom line, convincing managers and other primary stakeholders of the value of adopting more ethical and socially responsible business practices. Determine if it would ever be better not to conduct an ethics audit. Explain your rationale. Ethics audits help know the ethical goals and standards that need to be achieved. These...
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...the community. There are some idea that have discuss the role of audit professional ethics and the need to establish a mechanism to monitor compliance with ethical standards as well as violations of judicial ethics. Of these, the author continues to discuss the regulations on professional ethics for auditors. The provision on professional ethics for the audit practice is formed by the relationship between professional and social environment. The ethics provisions commonly found in the standards of professional ethics and regulations of the law. Although they both refer to ethics issues, but how to promulgate and content differences. In the U.S., the auditing standards and professional ethical standards by professional organizations audit (AICPA) issued and fully control the quality by professional organizations to undertake. Self-control model derived from the operation causes the independent auditors the United States has flourished, and very soon because the economy is funded by the stock market. The growths of audit activities from the absence of state regulations have led to the formation and development of strong professional organizations. Until the 2000s, a number of financial scandals and accounting outbreak led to the collapse of the leading companies in the world and cause serious effects to the interests of the public, including errors of audit firm. State United States began to intervene in audit activities through the issuance of the Sarbanes-Oxley. Sarbanes-Oxley...
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...time, internal auditing functioned as a junior to the independent accounting profession, and attesting to the accuracy of financial matters was the profession's main concern. Now internal auditing has established itself with a far broader focus. Modern internal auditing provides services that include the examination and appraisal of controls, performance, risk and governance throughout public and private entities. Financial matters represent only one aspect of the purview of internal auditing. Requirement to have Internal Audit Activity In January 2004, the US Securities and Exchange Commission (SEC) had approved new rules proposed by the New York Stock Exchange (NYSE) and NASDAQ Stock Market Inc. (NASDAQ) designed to improve their listed companies' governance standards. The New York Stock Exchange rules include a requirement, recommended by the IIA, that New York Stock Exchange - listed companies are required to have an internal audit...
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...an ethics audit committee • Define the scope of the audit • Review the organizational mission, goals, and values • Collect and analyze relevant information • Verify the results through an outside agent • Report the findings to Audit committee, managers, and stakeholders Secure Commitment of Top Management and the Board: • first step in the auditing process Top management may want a way to benchmark their ethical performance • The board may Initiate audits based on stakeholder concerns or in response to corporate governance reform Have been held responsible for the ethical and legal compliance programs of the company’s they oversee Establish an Ethics Oversight Committee: • Ideally, the board of directors’ financial audit committee would oversee the audit In most companies, managers or ethics officers’ conduct it • Individuals within the firm and external auditors should be involved An external auditor should not have other consulting or conflict-of-interest relationships with top managers or board members Define the Scope of the Audit The ethics audit committee should establish the scope of the audit and monitoring progress • Scope is determined by the type of business, risks faced, and the opportunities to manage ethics Includes defining the key subject matter or risk areas that are important to the ethics audit as well as the bases on which they should be assessed Review Organizational Mission and Goals • Ethics audit compare...
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...Ethics Audit Framework Essay # 3 Stephen Randall Texas A&M University – Central Texas Professor: Marshell J. Silva Ethics Auditing Ethics auditing by definition, an ethics audit is a “systematic evaluation of an organization’s ethics program and/or performance to determine its effectiveness.” This concept of ethics auditing is fairly new and few companies have conducted an ethics audit. However, performing such audits will likely become more mainstream as recent legislation encourages greater ethical accountability for companies to demonstrate they are abiding by the law and have established programs to improve their ethical decision making. The U.S. Sentencing Commission (the “Commission) has amended the Federal Sentencing Guidelines for Organizations (“FSGO”) whereby an effective compliance and ethics program must “exercise due diligence to prevent, detect, and report criminal conduct and otherwise promote an organizational culture that encourages ethical conduct and a commitment to compliance with all applicable law." The Commission noted there are seven minimum requirements of an effective ethics program, standards and procedures to prevent and detect criminal conduct; Responsibility at all levels of the program, together with adequate program resources and authority for its managers; Due diligence in hiring and assigning personnel to positions with substantial authority; Communicating standards and procedures, including a specific requirement for training...
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...Abstract Advanced Audit & Assurance often creates the question on practice of ethics in professional activities. The purpose of this report is to review Threats to Compliance with the Code of Conduct by Professional Accountants. With the expanding business in the modern world, issues arise on professionalism of Independent and Internal Auditors. Is it whether the Professional Accountants follows the ethical code provided by the International Ethics Standards Board for Accountants in order to provide true and effective financial reports to the internal and external users? Professionals are expected to conduct themselves at a higher level than most others members in the organization. The International Accounting Bodies has emphasized the conceptual...
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...Summary The article entitled “Code of Ethics for Internal Auditors Harmonised with the International Standards for Internal Audit” was written by George Calota. The article begins speaking about Code of Ethics – A condition imposed by the International Standards of Internal Audit. Ethics is defined by the article as a set of principles or moral values which people take as reference and which determines them to act in a particular way. According to the article, The Josephson American Ethics Institutes defined some ethical principles such as Credibility, which is the aggregated outcome of honesty, integrity, reliability and loyalty; Respect which represents an accumulation of concepts like politeness, manners, dignity, tolerance and acceptance; Responsibility, Equity & Justice, Empathy, Civic spirit. The Internal auditor’s code of ethics has the purpose to create the ethical framework required to undertake the internal audit profession, so that the internal auditor may accomplish their tasks professionally, loyally, correctly and thoroughly and refrain from any act which might harm the entity where they work. The article also discusses “Principles of Ethics and Professional Behaviour for Internal Auditors Harmonised with the International Standards for Internal Audit.” Under this heading it states that the internal audit activity helps the entity to achieve its objectives through a systematic and disciplined approach, by evaluating and improving the performance of risk management...
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...on the part of the public in the accounting profession. Lists the parties who you believe are most responsible for the crisis. Briefly justify each of your choices. The debacle of Enron, a US firm is looked upon as the worst debacle and fall out in the history of US bankruptcy filed cases. There are many parties involved when it concern to Enron debacle, which was accorded to accounting instability and the compromising factor of accounting profession itself. Out of the many parties in the league and the major force behind the debacle of Enron concern Andersen's, the accounting and auditing firm that once deserved name in the industry for its conscience in accounting professional services and auditing. As the case relates to, accounting audit for Enron is attended by Andersen's since long enough. However, the interesting feature is that some compromise in the profession of accounting services by Andersen's was notable, given that there are noteworthy feature of stock manipulation, especially in financial statements of Enron attended and audited by Andersen's. The statement and restatement of Enron also gives some probable indication for manipulation of accounting, where debate and counter debate in that regard from the prying eye of the media was a common feature. Thus, the involvement of Andersen's in Enron consultancy and professional auditing makes it rather more imploded for the direct involvement of Andersen's that also successively ushered the debacle and bankruptcy of...
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...International Business Assignment 4 1. Is it legitimate for an enterprise like Wal-Mart to demand that its suppliers adhere to a code of ethics? What are the benefits of this practice to Wal-Mart? What are the costs? Wal-Mart has developed a code of ethics for its suppliers. The suppliers must follow and adhere to the code set by Wal-Mart if their suppliers want to do business with them. The code have been made in order to evaluate employment practices and environmental compliance in facilities producing merchandise for sale by Wal-Mart. Wal-Mart demands from its suppliers that the business may be conducted in an ethical manner. The code of ethics made by Wal-Mart includes standards such as compliance with laws, voluntary labor, labor hours, hiring and employment practices, compensation, freedom of association and collective bargaining, health and safety, canteen, environment, gifts and entertainment, conflicts of interest, anti-corruption, financial integrity, worker helpline etc. We all know that Wal-Mart focuses on low prices of products in order to have the competitive advantage. This is the reason for the dominance of Wal-Mart in the market. If a company wants to give products or services to its customers at a cheaper price it must be taking various aspects and factors under consideration. In order to be able to deliver cheap products to its customers, Wal-Mart had to and decided to buy cost effective materials and products from the suppliers in under developed countries...
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...Topic 1: Ethics (Code of Ethics for Professional Accountants) Topic 1: Ethics (Code of Ethics for Professional Accountants) ------------------------------------------------- ------------------------------------------------- Introduction According to the Institute of Internal Auditors a Code of Ethics is a comprehensive statement of the values and principles, which should guide the daily work of auditors. The Code of Ethics states the principles and expectations governing the behavior of individuals and organizations in the conduct of internal auditing. It describes the minimum requirements for conduct, and behavioral expectations rather than specific activities. Fundamental Principles The Code of Ethics mandates that internal auditors behave and practice with integrity, objectivity, professional competence and due care, confidentiality and professional behaviour. These are the fundamental principles of professional ethics and all members of the professional accounting bodies are to comply with these principles (APES 110, S.100.4). Purpose of the Code of Ethics Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. A code of ethics is necessary and appropriate for the profession of internal auditing, founded as it is on the trust placed in its objective assurance about governance, risk management, and control. The Code of Ethics extends beyond the definition of internal...
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...A Code of Ethics DB Management Consultants is in business to serve non-profit clients with excellent management consulting skills and expertise that are essential for pursuing our client's goals. Our honesty and service is what we are all about and honest ethical behavior is our main priority. At DB Management Consultants we expect all of our employees, managers to behave ethically to company standards. If company ethical standards are violated than the employee can face disciplinary action and termination of his or her employment. The fulfillment of ethical rules and policy is a fundamental element to our Ethics Program- that pertains to DB Management Consultants; furthermore ensures compliance to rules and regulations within the company. Honesty and Service Integrating honesty and service means high morality; with customer satisfaction and good execution of work. Having a high morality shows proper care for people in our communities and socially responsible. Ethical Behavior DB Management Consultants employees and staff are expected to be honest and candid in their communications with their managers and with one another. When dealing with clients, government entities and the general public we need to act to the utmost level of personal integrity and promote in onto others. Employees must not be dishonest, deceiving or steal. All of DB Management Consultants employees must refrain from these illegal actions that can give our company a bad name. Quality Work and Customer...
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