Discuss how any of the principles of codes of conduct could be violated and what could be done to prevent that from happening.

"Responsibilities Principle

In carrying out their responsibilities as professionals, members should exercise sensitive professional and moral judgments in all their activities.15

This principle simply and clearly states that professional responsibilities require moral judgment, thereby equating professional behavior with moral behavior. The interpretation of the principle reads as follows:

As professionals, members perform an essential role in society. Consistent with that role, members of the American Institute of Certified Public Accountants have responsibilities to all those who use their professional services. Members also have a continuing responsibility to cooperate with each other to improve the art of accounting, maintain the publics confidence, and carry out the professions special responsibilities for selfgovernance. The collective efforts of all members are required to maintain and enhance the traditions of the profession.16

This paragraph, which notes the essential role that CPAs play in society, has great import. Accountants have a responsibility to all those who use their professional services. Here, again, is the anomaly we noted earlier. Most professionals prime responsibility is to their clients. Accountants, however, who play a critical role in the freemarket system (see Chapter 2) by providing an organizations financial picture, have numerous constituencies. Because the scope of their responsibility extends to all those who use the information data that is essential to doing business accountants have prima facie responsibilities beyond those to their clients or whoever pays them. Even though Enron paid Arthur Andersen, for example, as an external auditor, Andersen did not work for Enron. Andersens primary responsibility was therefore to the general public. The Responsibilities Principle also indicates the responsibility to cooperate with fellow professionals to maintain the integrity of the accounting profession. As we saw in Chapter 4, one of the obligations of a professional is to the profession itself. Specifically, the principle mentions three obligations: to improve the art of accounting, maintain the publics confidence, and carry out the professions special responsibilities for selfgovernance.17 Although the code gives little guidance on the obligation to improve the art of accounting, it pays particular attention to the obligation to maintain the publics confidence in the profession and the obligation to selfgovernance. Chapter 6, which addresses the code rules, will explore these obligations more fully. For now, suffice it to say that critics of the accounting profession most of whom are accountants themselves have maintained for years that accounting standards are inadequate for todays complex financial transactions. Recent accounting scandals have made their inadequacies only too clear. These events have also eroded the publics confidence in the profession. Thus, it is an ethical imperative that the profession carry out its responsibility for selfgovernance. It is arguable that the current practice of peer review is sufficient to fulfill that responsibility. To meet the moral obligations, according to the Responsibilities Principle, accountants must exercise sensitive professional and moral judgments.18 To do so, they must determine whether an activity harms others, is respectful of others and their rights, is fair, and is in accord with the commitments the accountants have made. Sensitive moral judgment is incompatible with selfish behavior. Thus, accountants are bound by the Golden Rule: Do unto others as you would have them do unto you."