Ethics Article Review Essay

This paper seeks to prepare a review of an article discussing ethics in accounting and financial decision making by making a brief summary, relating to assigned reading for the week, relating and applying the concepts to current or former employer’s organization, making improvement for the organization using the article as basis and explaining the importance of ethics in accounting and financial decision making. A description of the 2002 Sarbanes-Oxley act will also be discussed including its impact on accounting and financial decision making. 2. Discussions 2. a. Brief Summary The article is talking about the importance of ethics in accounting and business. To dramatize its significance in business, it has cited a story of a number of rich people who may have attained their financial rewards in business but ended dying in less meaningful ways impliedly because of missing the principles of ethics. While the article admits that earning money or attaining riches may be an acceptable goal in business, there is still the question of how success in measured in the final analysis and for which the authors were arguing for riches acquired with honor and if a choice would be made between the two, it would be more preferable to have honor rather riches (Smith and Smith, 2003) . 2. b. Relating to assigned readings As to how the article relate to assigned readings for this week, it may be argued that the article has touched on the importance of rules or guides to actions in business. Ethics in business may be asserted to be indispensable if business will have to attain its goals in harmony with other goals of society such as those in economics and politics. 2. c. Application of article to organization As to how the ethical concepts discussed on the article may apply to this researcher’s former or current organization, it may be argued that the universality of principles related to ethics would really make it difficult to exclude this researcher’s organization from any of its application.. Since my organization is part of the larger society where everybody else lives, it cannot isolate itself from the community by doing unethical things. It cannot even argue that any illegal or unethical thing that it may do will not matter in a world where there many players who may be affected by decisions made. In the same way that a member of society can make a difference for the good of the community so with the failure of one organization or even a person in the organization can do to the detriments of many if not all of the members of the community. 2. d. Recommendations for improvement of the organization To make recommendations for improvement on this researcher’s or organization using the article as basis, the organization should encourage simple living among its executives so that they could be more disciplined in the way the company’s resources are being managed not only for the stockholders but even to every stakeholders who stand to benefits from the observance of ethical conduct in the organization. The other stakeholders of course include the employees who aspire for long-term employment (Sears, 2003), the creditors and lenders who resources need to be protected as well, customers who need to have their needs and wants for company’s products and services continuously satisfied and the government who must continue ensuring payment of taxes and compliance with regulations. 2. e. The importance of ethics in accounting and financial decision making and how the 2002 Sarbanes-Oxley Act affects the same The important of ethics in accounting and financial decision making cannot be underestimated. Without ethics there would be no responsibility for right or wrong act can be demanded from people making decisions. The managers who are considered agents of stockholders would instead enrich themselves at the expense of stockholders investments. On the other hand, these stockholders would just exploit whatever they can to the detriment of their principal, this time their debt capital providers. The organization can likewise treat its employees with disrespect and violate the latter’s if there in no ethics that would guide them. Laws will be insufficient to exact compliance if people in the organization were not instilled the proper values when they were still young in the same way that it is hard to teach tricks to an old dog. The Sarbanes-Oxley Act of 2002 is a classic example to legislate rules of conduct that would improve corporate governance (Ali, et. al, 2006) including a more strict compliance of requirements in regulating companies in terms of financial statements and ensuring of ethical conduct of external auditors (Bainbridge, 2007). Although the law is a positive act to ethical practice of doing business, the choice to do what is right is still with decision makers who must have the right sense of values for society. 3. Conclusion: Ethics has a purpose to attain. It is a part of an organization’s life since it is a guide to decision making not only in accounting and finance but even to all other aspect of business operations. A sense or rightness or wrongness offers a choice and that which is good is incidentally consistent with ethics. As the world seems to be painting what are the standards of its success when actually they are not the real and lasting ones, ethics its and principles have much to offer in making the correct decision that will lead real and lasting success for human existence. The article has argued that honor is preferable than riches but riches need not be inconsistent with riches as long as they are ethically acquired. References: Ali, et. al (2006) International Corporate Governance After Sarbanes-Oxley, John Wiley and Sons Bainbridge (2007), The Complete Guide to Sarbanes-Oxley: Understanding How Sarbanes-Oxley Affects Your Business; Adams Media Sears (2003) Successful Talent Strategies: Achieving Superior Business Results Through Market-focused Staffing, AMACOM Div American Mgmt Association. Smith and Smith (2003) Business and Accounting Ethics, {www document} URL, http://acct. tamu. edu/smith/ethics/ethics. htmAccessed September 29,2008