European Online Journal of Natural and Social Sciences 2013; www.european-science.

com
vol.2, No. 3(s), pp. 518-526 ISSN 1805-3602

Professional ethics in accounting and auditing: A necessity or choice

Mehdi Talebian
Department of Accounting, Shomal University, Amol, Iran

Abstract ther. Thus, accountants shall observe a group of ethi-

cal principles. Ethics in accounting make it necessary
Ethics is an inclusive subject that covers all aspects for accountants to possess professional knowledge and
of human’s life. The ever- increasing development of skills at level of the task which they intend to do it so
human communities and further complexity of social that to be able to present the efficient and effective ser-
relations and ties create new requirements. Emerging vices to their employers and customers. Unfortunately,
of various professions is the consequence of effort to we still live in a world in which substance of ethics has
meet these needs which form over the time and change not been yet perceived that it means developing correla-
in circumstances and gradually pass through path of tion with other humans. It has not been found that eth-
development and evolution. Due to necessity of work ics is exclusively the interested subject and concern for
division and expert nature of affairs, these professions all humans and hegemony of any superman is not hid-
are more consolidated every day and play their role in den behind it. Unfortunately in our country, discussion
improving public welfare for communities. Survival of about accounting may delight a group of people; from
any profession and employment is subjected to type their view if accounting is not ethical subject then it is
and quality of services that it presents and credit and not considered as real accounting so it is counted as a lie.
trust, which are acquired as a result of giving such ser- Major scandals in some leading enterprises like Enron
vices. This credit and confidence is the main capital for and World.com put ethics as the agenda for account-
any profession and it crucially important to maintain ing practitioners for which for several years accountants
them. This requires any profession and its members to were committing window- dressing; they managed so-
serve the community as their main task and goal and to called returns; they gave improper information about
pursue and interpret their personal benefits only within costs; they exaggerated about revenues and ignored
the framework of giving these services. Although, it is misuse from funds of businesses and presented mislead-
a long time that accounting professional communities ing financial statements and made it possible to conduct
in several countries have codified professional conduct transaction with reliance on hidden deals by receiving
code in order to protect from public properties and re- bribes and allocation of huge bonuses. Any civilized
quiring accountants to observe professional ethics, it community that is founded on ethical values will decline
seems that professional conduct code could not solely regardless of ethics of civilization. Observance of ethi-
solve the existing problems and so far professional ac- cal rules by businesses may improve public trust on their
counting scandals occur throughout the world. goods and services. Ethics should be trained. People are
not born with tendency to become ethical and observ-
Keywords: Accounting, Ethics, Profession, Pro- ing rights of other people and social welfare. In this way,
fessional Ethics, Fundamental Principles accounting communities may train ethical disciplines
and also require their members to observe them. At least
Introduction during 25 previous years, Iranian Accounting Commu-
nity has always relied on the late Dr. Mostafa Ali Madad
In line with development and creation of value in (1936-2012) as an exemplar in ethical accounting and
the society, accounting profession requires properly shown him as a sample and model to young accoun-
practice and ethics, especially because of this fact that tants. In the corrupted business climate of Iran, Mr.
accountants’ services are presented to the public fur- Ali Madad was no so anxious to say: “I could not do

Corresponding author: Mehdi Talebian, Department of Accounting, Shomal University, Amol, Iran. Email:
talebian_mahdi@yahoo.com

Copyright © Mehdi Talebian, 2013

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518
 Social science section

all the work alone, but I should not be ignoring what I present them and those groups might claim for. Today,
can do.” He was too brave to say no; he was courageous accountants including employees in public and private
enough to confront with the reality. He sought for do- enterprises, as the owners of a social reputed profession,
ing what he discerned as right. As a result, despite of all should obey public ethical principles, rules, regulations,
adverse environmental conditions, he remained abso- and norms of community in such a way that to add to
lutely abide by his ethical principles and disciplines and good reputation and fame of accounting profession. In
he did not pursue this way that he might follow up the addition to possession of ethical virtues and well moral-
current trend of community with the pretext that all ar- ity and individual behavior in a professional account,
eas in this business were corrupted and he did not leave the professional accountant should observe professional
away his right principles even less to violate from them. conduct codes of professional accountants in doing his/
In a community where fulfilling a task is considered as her occupational tasks that it has been stipulated by the
a virtuous act, Mr. Ali Madad sought for doing his duty relevant audit institutions.
without any expectation. Death of Dr. Ali Madad was a
mournful pain for the accountants and it created a deep Definition of Ethics
sorrow among accounting community of Iran and all of
these are not only for the sake of tens of his valuable ac- There are several definitions from ethics. Eth-
counting books neither for a mass group of his students ics is plural form of word that means mood and tem-
and nor his unique share in construction of University perament. Mood (Kholgh, plural: Akhlagh) stands for
in Baluchistan (southern Iran) and this reality that he habit and conduct. Several synonymous terms have
tried to realize it and he devoted several years of his life been expressed in Dehkhoda Thesaurus. The English
for the given university, but it was due to his premium equivalent term that has been mentioned in Webster
status in fulfillment of his obligations and feeling of re- Dictionary means study on proper and erroneous ways
sponsibility versus this country and Iranians in the field on human’s behavior. Likewise, the Prof Morteza Mo-
of accounting. Above all, Dr. Mostafa Ali Madad was tahari in his book, called “Practical Wisdom”, intro-
an ethical accountant that had tied his love to Iran and duced term “Ethics” as knowledge of life or the science
improvement of Iran’s position with his obligations and of how to live and he divided it into two branches of how
responsibilities versus accounting knowledge. to be and how to behave by adding that how to behave
is related to actions and deeds (including speech) while
Nature of Accounting Profession how to be, might influence in moods and substances of
behavior on way of temperaments and states and the
Accounting is invented by human and a result of moods in relation to quality of human’s existence. Eth-
human agreements. To define accounting, it can be im- ics seeks for finding principles and rules that employ-
plied that it is a group of rules and methods that are clas- ing them results in goodness and salvation for human.
sified by their application and financial and economic Whereas the main objective of arising of Islamic Holy
information and summarized in the form of accounting Prophet was purification of one’s existence and train-
reports and statements and put at disposal of the inter- ing of humans and developing well morality so it can be
ested persons and beneficiaries. These individuals may said that divine verses (Quran) and signs are deemed as
be informed about fiscal status, results of operation as an introduction to subject of purity of soul and training
well as the future outlook of the given institution. The of humans that contain the main goal in ethics. Profes-
first and original goal of accounting is to present infor- sional ethics is one of its elements and it includes good
mation about economic activities of a person or an or- rules and methods, which are adapted in a profession.
ganization. At first, only one person namely an owner
of economic enterprise might need to this information Accounting and Ethics
but after becoming more complex and systematic trend
of economy, number of the persons and users of finan- In today advanced economic world, accounting is
cial statements that needed to these reports and agents a vital profession since the current economic system
of production and distribution of information was in- could not exist without this element. It is a technique
creased; therefore, role of accountant was changed and practice in accounting profession that has been
to presentation of beneficent information about eco- formulated to contribute to individuals in order to track
nomic activities into several groups, who had legal the effect of their economic transactions. The sense of
right to know organizational activities. The real image accountability to the public is the paramount distinc-
of those activities is what the accountant is obliged to tive feature of accounting profession with other occu-

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pations. There are many expectations in this filed by quantitative nature and ease of use, this inventory
people and society from providers of these services and has been adapted in many accounting ethics studies.
people should trust in quality of the presented services In an investigation, Toronto (2000) examined
by accountants and auditors. Thus, the presented in- the assumed validity of Kohlberg’s triple criteria
formation by accountants should be noticeably effec- model which consists of theoretical basis for testing
tive, reliable, real, and objective. Therefore, accoun- of definition of these topics. The results of this study
tants not only should be qualified and with professional showed that validity of these assumptions is chal-
competencies, but also they should be benefitted from lenged so ethical studies in accounting should be
professional sincerity and integrity so professional re- again repeated since the existing linear relationship
pute and honor are some of foremost properties for among lower scores of testing subject definition and
them. As a result, accounting ethics is very important the professional behavior of accountants that were
for professional accountants and individuals, who rely purposed in the previous studies are invalid.
on accounting services. But, at the same time this trust Forest typically deems Kohlberg’s attitude as
and confidence may be maintained in respective of ac- sophisticated and based on improper reasoning and
counting profession when professional accountants he declares that this model is based on a philosophi-
give their services at the level which duly deserves so- cal approach not scientific attitude to analyze ethical
cial trust. Thus, accountants should present their ser- behavior. Forest argued that the scientific method is
vices in such a way that to they are given at the highest the most preferred technique for evaluation of be-
possible quality and by observance of regulations that havior. He states�������������������������������������
that
������������������������������������
regardless of ethics, individu-
guarantee continuous services with appropriate quality als may take some mood that in some way effects on
(Duska R.F, Duska, B.S, 2003). their judgment. In Forest’s model, which is the in-
Ethics is a broad based subject that covers all as- frastructure for ethical position questionnaire, it is
pects of human’s life. Ever- increasing development maximally focused on a perfect psychometric crite-
of human communities and their more complicated rion for measurement of ethical behavior instead of
social relations and ties may create new needs. Emer- seeking for ethical development level in individuals.
gence of several professions is the result of attempt to He maintains that since this model focuses on ethical
meet these requirements that form over the time and judgment by adults so it is much useful than Kohl-
changing the conditions and gradually pass through berg’s model. This claim has been proved in the next
the path development and evolution. Due to neces- conducted studies, which have been done based on
sity of work division and expert nature of affairs, these ethical situation.
professions become more integrated every day and play Forest divided individuals’ ethical philosophy
their role in improving public welfare for communities. into two classes of relativist and idealist. Relativism
is an ethical philosophy based on its view there is
Review of literature no universal system of ethical rules and criteria. The
relativists believed that conditions, situations, and
The earliest ethical studies have been mainly also individuals involve in determining ethical and
conducted based on Kohlberg’s perceptional- ethi- or non- ethical nature of a decision and any behav-
cal model. This model is affected by Piaget’s the- ior may be considered as ethical or immoral under
ory combines ethical psychology with perceptional different circumstances. Idealism is another ethi-
psychology and presented six steps of perceptional cal philosophy in which human’s welfare is placed
growth, which indicate the individual’s perceptional at the turning point of decisions. The persons with
and ethical promotion like ladders steps at three lev- higher levels of idealism claim that it should always
els. Kohlberg expresses that ethical judgment skills act in such a way that no loss or damage inflict to
may be developed in various persons at different ra- anyone. Those who are lesser idealists argue that it is
tios. Pursuant to Kohlberg’s study, another thinker not possible to avoid from incurrence of damage and
called James Rest presented testing method for defi- loss to others under all conditions. Thus, good deed
nition of these subjects where this test is used as a should be done every time even though it may inflict
tool for evaluation of ethical development level in damage or loss to some other people. With respect
individuals. Rest’s theory is based in a questionnaire to these explanations and in order to understand the
which is marked by respondents and it can be statis- above issues better, in the following we describe eth-
tically analyzed and obtain some scores (i.e. P) that ics. Then, role of ethics is interpreted in accounting
show rate of ethical growth in any person. Due to its profession and ethical problems.

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 Social science section

Professional Ethics will find well the interrelated connection among re-
ligion and ethics and consider ethics as an integrated
Term of professional ethics became popular and part of religion. Subject of ethics and moral purity is
known as one of the properties of human and intellec- crucially important in Islam so that moral training, pu-
tual capitals in any community or organization since rification of human’s soul and growth and guidance of
18th and 19th AD within political, economic, and social community are the goals of descending Quran while
literature among western authors. Professional ethics is moral characteristics are deemed as criterion for hu-
a type of moral obligation and work consciousness to- man’s value for which in the position of praising and
ward any variety of work, duty, and responsibility. Dur- admiration of God’s prophets, it exalts them for pos-
ing recent decades, the concept of professional ethics sessing godly ethical attributes. For example, Quran
has been noticed further by Iranian organizations. had praised Prophet Abraham (PBUH) for possessing
In other words, it is “have to” and “have not to” three honorable supreme ethical features, stating that:
subjects that personnel of an organization (commu- “ … Most surely Ibrahim was very tender-hearted
nity) shall observe for realization of all occupational forbearing”. (9: 114 Immunity)
quantitative and qualitative conditions for which Also, Holy Quran states about Islamic holy
they have been obligated and their symbol is hon- prophet that:
esty in behavior, speech, and practice. Observance “And most surely you conform (yourself) to sub-
of professional ethics causes giving continuous pro- lime morality” (68:04 Al-Qalam)
fessional services to the community and fulfillment It is enough about importance of morality and
of its disciplines leads a profession to continue its purity of soul that Holy Quran expresses his good
advancement and to become accepted by the public. morality as the key of holy prophet’s (PBUH)
Thus, if we also intend to preserve validity of ac- achievement in fulfillment of his divine mission and
counting and auditing profession for the future so spreading God’s Unity belief and implies:
we should always try to maintain and improve public “Thus it is due to mercy from Allah that you deal
trust in this profession by considering the interests with them gently, and had you been rough, hard heart-
for all and we should make every effort in this path ed, they would certainly have dispersed from around
since if we ignore our right in benefitting from social you …” (3: 159 Family of Imran)
ethical appropriate status eventually no suitable fate We may find well it through pondering into Is-
will be predictable for the given profession. lamic traditions and life (biography) of Innocent
Gharamaleki considers today performance as to- Imams (PBUT) this point that all aspects of life in
morrow market and expresses that professional ethics all aforementioned grand figures have been the sym-
has been presented to optimize today performance so bol of realizing ethical features and human’s precious
that to guarantee market in tomorrow. He claims that characteristics and divinely morality came to the cli-
professional ethics is intended to fulfill the organization- max in behavior and existence of them so they her-
al ethical responsibilities against environmental rights. alded for piety and human good virtues and morality.
Thus, he considered an organization as ethical that it Given that human is a creature with free will, which
recognizes environmental rights and observes them by should deliberately and freely rise for implementation of
knowing that to which individuals and institutions this divine orders but such a movement may not be fulfilled
organization is responsible for and what priority may ex- by issuing rigid rules and exertion of power and force but
ist in respective of these persons and entities. in turn the needed motive should be created in human
so that human can try in this course free of any sense
Ethics from Islamic view of pressure and stress. This motive creates by belief and
ethics and it is strengthened while divine rules are ex-
Religion (in Islamic case) is a group of beliefs and ecuted along with moral values. Therefore, moral values
practical orders, which have been presented by World will guard religion and guarantee enforcing these rules.
Creator according to claim of their provider and fol- It is a matter of fact that as the witness of today individ-
lowers about these ideas and recommendations (Is- ual and social problems in protests and demonstrations
lamic prophet and Muslims). If we consider the ethics that were staged against capitalism system and objec-
as some teachings that duly draw the way and conduct tive sample in Occupation Wall Street Movement and
of living, then some shall and shall- not value cases ap- other European countries, all these occurred because of
pear that govern on human’s behavior; as a result, we downplaying the role of ethics in modern world. Thus,

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it is onus on all members and particularly practitioners judgment needs to efficient, useful, and uniform tool
in this profession to try for training ethical original val- where accounting is one of these tools. Assumptions,
ues and to return to the system of religion and ethics limitations, and constraints are the infrastructure for ac-
and avoid from moral vicious acts in order to prepare counting principles and rules as operational tools so that
the ground for their maintenance and progress and for acceptance, selection, or admission of assumptions and
community and this profession. the aforesaid bases are subjected to the presence of mor-
al virtues and employing them toward the common and
Professional Ethics Growth and Development final goal of accounting. Role, duty, and responsibility
of accountants and auditors against community require
The rate of development and growth of profes- them to observe ethical principles in all aspects and to be
sional ethics depends on the amount of successful per- loyal to an integrated professional conduct code in or-
formance of professional ethics as well as its flexibility. der to acquire social admission, repute, and respect that
The more professional ethics is observed, the higher are necessary for activity in any expert profession. Since
level of commitment to its principles will exist. At the accounting and auditing profession is related to one of
same time, the more logic constraints are exerted by the most crucial relevant issues to community members
the professional ethics with more effective organiza- i.e. individuals’ properties and assets so trust may play
tional development, the stronger commitment will be essential role in developing accounting and auditing
taken for them. The main factor for growth and de- profession. For this reason, professional conduct code
velopment of these principles in certain profession is and commitment to it is a very important fundamental
the cumulative integration. Cumulative integration is factor on which duration and survival of the given pro-
also affected by some other factors, of course. Some fession extremely depends and community pays special
researchers argue that occupational satisfaction may attention to this factor.
increase creating commitment to ethical principles in
the profession; however, it should be claimed that job Bases of professional conduct
dissatisfaction is versus occupational satisfaction. Job
dissatisfaction may also lead to formation of a type of Compared to other occupational groups, accoun-
professional ethical principles. Communication and tant show lesser commitment to ethical principles
giving information to members about the latest related since they may imagine that accounting is a technical
news and focus on financial disambiguation as well activity and it is not related to ethical principles. Ac-
as determining the relationship with other public and counting training system more negatively effects on
non- governmental organizations and admission of formation of moral tendencies among students. Any-
group’s decisions that were made anonymously by the way, rather than concern about accountants, great
majority and most importantly providing the needed attention is paid to changing nature of accounting
grounds for fair competition and new markets could be profession whether in specialized form or in general
useful in developing professional ethical conduct. since according to Modick (1987), overall people’s
trust in each other has reduced while Brose (1996)
Status of ethics and its role in advancement argues that age of respect has passed and people are
of accounting and auditing profession no longer ready to accept talks of power owners.
In his investigation, Larsen (1987) refers to
As a general and modern concept, accounting re- some of surveys based on which 30-40% of the con-
flects the position and effects of social activities and au- ducted accounting operations were under standard
diting results that play essential role as supervisory arm level in USA.
and the position of this profession should be identified Michel and Sika (1993) claim that today pro-
in classification and social valuation proportional to the fessional accounting is non- profitable occupation
given role. The ultimate goal in accounting and audit- that is used for attraction of prosper businesses and
ing is definitely providing the trustable information re- growing worry has emerged regarding the hazardous
quirements for users where due to the emerged trans- impact of following up the commercial goals based
formations in political, economic, and social structure, on quality of accounting services. To acquire order
international and managerial trading relations that form and being organized, a society should inevitably lay
accounting context will still remain unchanged. Since foundation of behaviors based on ethical principles.
equity (justice) causes social calmness so it requires de- It may be deduced the point in this way that ethi-
liberative judgment to administer justice and attentive cal principles act like an adhesive, which put ele-

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 Social science section

ments of society together. Requirement to presence Fundamental principles

of ethics in a community is highly important and it
is unlikely due to this fact that ethical values are in- Generally, in professional conduct code for ac-
corporated into the rules. Of course, all values could countants, the fundamental principles are as fol-
not be included in regulations and this is because of lows:
judgmental nature relating to certain values. 1- Integrity
As an expert or professional person, a certified 2- Neutrality and independence
accountant is tasked with the responsibility against 3- Competence and professional care
people, employer, colleagues, or the related co- 4- Professional privacy
workers and he or should try to behave respectfully. 5- Professional conduct
The main reason for adaptation of such a behavior 6- Professional principles and standards
by a professional or expert is that people trust in
quality of work and services that are presented in Originality
this profession. If people do not trust in services Originality means accountant’s commitment to
given by the certified accountant then their poten- general ethics and fair and honest treatment in the
tial for presentation of services to people will be field of professional work. By doing this task, he\
noticeably reduced. Several studies indicate that she may contribute to the given profession and this
at least three factors along with each other have principle requires other bases of originality. Origi-
caused to form, grow, and develop various profes- nal accountant is someone who assigns a task to the
sions during human civilization history and they other person that can do it better if he/ she found
are the secret for survival: that he/ she personally could not do the given work.
- Inclusive professional organization
- Professional conduct code Neutrality
- Philosophy, theoretical bases, and professional Accountant should be neutral (objective) and he/
principles and standards she should not allow tarnishing his / her neutrality by
As a professional actor, accountant has some any prejudgment, favoritism, and influencing by others
obligations that do not apply for non- professional through giving services. Among fundamental principles,
personnel. In accounting, ethical behavior is not this standard means avoidance from friction and conflict
something except for taking general attitude espe- of interests. To achieve neutrality, professional accoun-
cially toward ethical behavior that was suggested by tant should prevent from those relations that can cause
philosophers to humans. influence by others and make sure that the subordinate
From perspective of professional conduct fun- colleagues are also committed to principle of neutrality.
damentals, accounting professional goals are to
achieve the best professional principles and disci- Competence and professional care
plines; implementation of operation at highest pos- It means deeply comprehension of professional
sible level of quality based on the aforesaid principles work trend and subject of addressing them. Pro-
and rules and generally providing public interests. fessional accountants should be always obliged for
Realization of these objectives requires provid- those services that he/ she can fulfill them and he/
ing the cases as follows: she could cooperate or counsel with other if needed.
a) Validity: Community needs to reliable and Similarly, professional accountant shall possess pro-
valid information and informatics systems. fessional knowledge, skill, and experience at suitable
b) Professionalism: The professionals in the pro- level and also have the needed moral competence in
fessional accounting field should be easily identified this regard. Some of professional competences are
and recognized by work owners and employers and as follows:
other beneficiaries. 1- Recognition of occupational techniques and
c) Quality of services: It should be assured that all professional methods
given services by professional accountants are pre- 2- Identifying the economic organization and
sented at the highest possible level of quality. enterprise
d) Trust: Users of the given services by profes- 3- Computer literacy at the needed occupation-
sional accountant should be assured that there is al level
a certain framework for professional behavior that 4- Acquaintance with occupational engineering
control presentation of those services. and technical information; and

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5- Perfectly information about accounting pro- Professional independence of scientific ethics

fessional principles and standards Like ethics in any professional system, this factor
should reflect inter-professional norms and sense of
Privacy ethical commitment by the professional personnel and
It is to consider employer’s information as con- their expert institutions and they should not be imposed
fidential data. Professional accountant should make and compelled and noticed to them in the framework
sure of observance of principle of privacy by his/ her of ethical shall and shall- not subjects. For example, a
subordinate personnel and assume the responsibil- professional accountant should follow some issues like
ity for security of the collected information. Profes- honesty, accuracy, trustfulness, openness to climate of
sional accountant should notice privacy of informa- critique and evaluation, respectfulness to subordinates
tion that she/ he may acquire during process of giving and surrounding personnel, paying attention to pri-
professional services and should not use or disclose vacy, and confidentiality for individuals.
this important information without taking explicit
permission from employer unless he/ she is legally or Professional self- concept
professionally allowed to disclose such data. Professional self- concept is the basis for ethics.
The individuals could achieve the moral percep-
Professional conduct tion only by their self- concept of professional work
It is to do activities that are compatible to ac- and activity and its philosophy regarding people’s
counting profession. Professional accountant life and as a result, they acquire an internal sense of
should behave in such a way that to be compatible commitment to those values in their relations with
with his/ her professional good reputation and it nature and surrounding world.
does not tarnish the professional repute. Likewise
he/ she should treat politely and with respect to Objectivity, neutrality, and lack of favoritism
others during doing his/ her tasks and behave them Observance of objectivity and neutrality is one
properly and aptly. of the paramount basic principles that are confirmed
in most of documents and topic relating to scientific
Professional principles and standards professional ethics. The person who employs pro-
This element includes observance of the stan- fessional ethics in his/ her occupational life should
dards and disciplines. Professional accountant should not show irrational favoritism toward the source of
do employer’s requests skillfully and carefully. immoral features.

The basic feature and factors in professional Going beyond sustenance concept
ethics Paying attention to other issues is downplayed
until a person involves in physiologic subjects. By
As modern concept, features of professional passing through physiologic concept, meaning of
ethics include possessing identity and the needed professional ethics comes to appearance. At least
knowledge; playing practical role; presentation three other levels of scientific and technological ac-
of professional procedure, being local and cul- tivities make sense for them when the individuals
ture- dependent; dependence to a moral system; are going beyond level of sustenance in their profes-
presentation of humanistic knowledge with clear sional business and activity:
motivational language; purposing interdisciplinary • Sense of efficiency, effectiveness, and produc-
approach (Amiri, p 140). tion of quality as value- added
Many expert professions like medicine, lawyer- • Sense of serving the nation and helpfulness
ing, and accounting and some of social and eco- • Sense of relief by redistribution of opportuni-
nomic or political institutions and organizations ties and power critique
have official and codified ethical rules that interpret
and determine the quality of organizational be- Incompatible activities with accounting
havior, actions, and responsibilities of professional profession
members against the community of third parties
(Ali Madad). In an article, Stephen Ivens mentions The professional chartered accountant shall
some factors as the basic factors for professional avoid from admission and doing incompatible ac-
ethnics that include as follows: tivities with this profession.

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Substitution of a professional chartered accountant and they are characterized as secret of their survival.
• Professional chartered accountant should exam- These three factors are as follows:
ine the professional reason for acceptance of new task; Philosophy, theoretical bases, and professional
• Rights of minor owners shall be considered in principles and standards
substitution of professional accountant; and The given profession may achieve the necessary
• Rights of former accountant shall be reserved. power to continue professional activity with the pres-
ence of three aforesaid factors together and they will be
Advertisement and Promotion deep-rooted in the society so they are neither dramati-
The presented information should be perfect, prop- cally changed by environmental variations nor omitted.
er, and realistic and of doing incompatible measures The first factor should necessarily exist in order
with the above principle should be avoid, including: to describe and interpret the quality and reason of a
• Creation of unrealistic expectations; profession and also to acquire recognizing and expla-
• Pretension to have power of influencing in of- nation of the existing phenomena and predication
ficial institutions and authorities; of similar professional phenomena. Thus, seeming-
• Self- praising ly independent and separate ideas and thoughts are
• Comparing oneself with other professional presented within a relevant and interrelated system
accountants; and such as theoretical body knowledge. Phenomena are
• Unjustifiable claims adjusted to the purposed theory by empirical obser-
Communication is allowed in the following cases: vation and the needed tests and logical reasoning in
• Appointments and changes (membership in order to measure its power. Johnson and Bledstein
professional associations); (1971, 1976) claim that acquisition of this body
• Manual; knowledge theoretically, as one of the main proper-
• Publication of books, essays, interviews, lectures; ties of a professional activity. Heinz maintains that a
• Training pamphlets; professional can survive and develop by claiming to
• Apprenticeship courses and conferences; achieve body of such knowledge (Isaee Khosh, 2010).
• Employment of personnel; Without first factor, the utilized techniques and
• Headlines and table of professional unit; and procedures are converted into some rules which are
• Recording title of the professional chartered followed further by habit and tradition than reason-
accountant on the published documents by employer able admission. Similarly, regardless of this fundamen-
Regarding recruited professional accountants, tal factor, it is impossible to overcome to the unsettled
the executable orders are as follows: current problem and professional problem in the fu-
• Obedience to the law ture and or present appropriate solutions for them.
• Observance of professional principles and Third factor, namely, professional conduct code
standards and its obedience is the fundamental and crucially im-
• Avoidance from presentation of misleading portant factor on which the survival and duration of the
information given profession depends extremely and community
• No allowing mentioning his/ her title in the especially pays attention to this factor (Yeganeh, 2007).
documents and papers which have been improperly It is better first to define ethics before entry in the
drawn up subject of professional principles and ethics of accoun-
• To resolve professional disputes and contra- tants and then to see generally when the subject of eth-
dicted views inside the organization ics was noticed further in accounting and auditing.
• Resignation from work if needed
• Supporting professional colleagues Reasons of ethical problems in accounting profession
• Professional competence; and 1- Fraud: Fraud is a deliberative action done by
F Presentation of information based proper reg- one or more individuals from managers, personnel,
ulations and the relevant standards and or third parties in order to present improper finan-
cial statements and it may include the following cases:
Requirement of professional conduct code and ethics • Manipulation, forgery, or alteration of docu-
The conducted studies indicate that the pres- ments and proofs
ence of the fundamental factors along with other • Recording transactions without evidentiary
has caused formation, growing, and developing sev- documents
eral professions during human civilization history • Incomplete or dual recording in books

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 Social science section

• Improper presentation of financial evidences obvious that by doing this task, this point will be cer-
of transactions or omission of them from documents tainly realized that in the future accounting pressure to
and proofs; and be able to continue playing its historical role in fairly
• Non- observance of financial and tax regula- economic growth, success, and welfare.
tions and the relevant rules
2- Abuse of assets References
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8- Disclosure of confidential information of with ethical elements and its measurement tech-
employer for rivals and others niques in accounting. Collection of essays from
9- Not providing the adequate reserve for deduc- accounting and management regional conference,
tion of inventories value and unrecorded costs; and
Islamic Azad University (IAU), Noor branch.
10- Lack of giving information or presentation
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of improper information to capital market in order
evitable necessity in today organizations, Age of
to affect on stock rate
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Conclusions
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In accounting profession, the necessary skill
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