Code of Professional Ethics and Conduct Essay Example | Topics and Well Written Essays - 750 words

Code of Professional Ethics and Conduct - Essay Example There is an urgent need to remind members how important it is to follow these rules in the performance of their assignments so that high ethical standards can be maintained and avoid controversies. In this connection, it is important for the profession to be strict with regards to observing standards formulated by its professional bodies in terms of accounting and auditing ethics and conduct. A member must at all times endeavor to observe the code of conduct that governs their profession. Rule 102 – this rule pertains to integrity and objectivity. This means accountants should maintain at all times honesty in performing his work and avoid conflicts of interest that may be damaging to that integrity and objectivity by assiduously observing independence. Expectations of the code is a CPA will not knowingly misrepresent facts, make materially false or misleading entries or fails to correct those erroneous entries when there is an opportunity to rectify them. Violations of this ru le was shown in the case of Mr. Robert E. Allgyer of Lake Forest, in the state of Illinois, for alleged violations of the Codes of Professional Conduct of the AICPA and also in relation to Securities and Exchange Commission (SEC) Rule 102 (e) about a rendition of professional services for Waste Management, Inc. wherein there was improper conduct by him. The integrity of Mr. Allgyer was questionable due to his issuance of an Order instituting Public Administrative Proceedings which the SEC construed as negligence on his part. However, Mr. Allgyer entered into a compromise settlement with thInstitutingich he was fined $50,000 and also suspended from his professional practice for two years, with a right to re-apply for the privilege of practicing before the SEC only after the lapse of five years. I think the disciplinary actions taken against him were too harsh (professional suspensions) considering that he paid the substantial civil monetary penalty of $50,000 (AICPA, 2012b, p. 1). Ru le 102 (e) of the SEC now allows it to sanction any individual CPA in addition to public accounting firms, the firms they worked for and their audit committees. This new rule change refers to negligence on the part of individual CPA which constitutes as improper conduct and a violation of professional standards of conduct applicable in the instant case (With a controversial change to rule†¦, 1999, p. 1). Rule 201 – this rule refers to professional competence and cares with regards to the handling of financial documents. It means any member must be competent in terms of academic theories (continuing professional education credits or CPE) and adequate work experiences. Moreover, this rule requires due professional care during rendition of any professional services by ensuring proper planning before any work is started, make adequate supervision during the performance of professional services and ascertain if there are enough valid data, documents and all relevant informati on for a reasonable conclusion or a proper recommendation with regards to all services standards (NYSSCPA.org, 2009, p. 1).