Ensuring Accounting Ethics Through Regulation
This paper examines the role of ethical regulation in corporate accounting, focusing on how financial scandals have prompted legislative responses at both the state and federal levels. It discusses California's updated accounting standards, which require peer reviews of accounting firms, continuing ethics education for CPAs, and public webcasts of Board of Accountancy meetings. The paper also draws on foundational accounting ethics theory to argue that accountants bear responsibilities to multiple stakeholders. It further addresses how the federal Sarbanes-Oxley Act of 2002 and the Public Company Accounting Oversight Board work to curb unethical practices and protect public investors.
- Introduction: Greed and the Need for Ethical Oversight: Corporate greed demands stronger ethical accounting regulation
- California's New Accounting Standards: California mandates peer review and public webcasts
- Peer Review and Continuing Education Requirements: New rules require periodic reviews and updated CPA training
- Implications for Corporate Accountability: Transparency measures strengthen corporate ethical image
- Theoretical Foundations of Accounting Ethics: Ethical theory underpins accountants' professional responsibilities
- Federal Response: The Sarbanes-Oxley Act: Sarbanes-Oxley and PCAOB protect public investors
✍️ How to write this paper — guide, tools & examples ▾
What makes this paper effective
- The paper connects abstract ethical theory directly to concrete legislative examples, grounding its argument in both philosophical principles and real-world policy.
- It moves logically from a state-level case study (California) to a broader federal framework (Sarbanes-Oxley), giving the argument a clear escalating structure.
- It cites a mix of source types — news articles, academic texts, and legal resources — demonstrating engagement with multiple forms of evidence.
Key academic technique demonstrated
The paper uses the technique of applied ethical analysis: it introduces an ethical framework (accountants' responsibilities to multiple stakeholders) and then evaluates specific regulatory mechanisms against that framework. This approach, drawing from Duska & Duska (2003), shows how academic theory can be used to evaluate and justify policy positions rather than simply describe them.
Structure breakdown
The paper opens by establishing the problem (unchecked greed in corporate accounting), then presents a state-level legislative solution as a case study. It uses that case study to draw practical recommendations before broadening its scope to ethical theory and federal law. The conclusion anchors the argument in the Sarbanes-Oxley Act and the PCAOB as structural safeguards. The structure moves from problem → state solution → theory → federal solution.
Introduction: Greed and the Need for Ethical Oversight
There is always the possibility for greed to reign supreme within the context of American capitalism — it is an unfortunate part of the free market system. Yet the immense greed that has cost shareholders dearly in recent scandals can be curbed through proper ethical regulation of corporate accounting practices. Through ethical accounting, shareholders can rest easy knowing that their money is being handled with a sense of ethical responsibility.
California's New Accounting Standards
In the midst of so many recent financial scandals and the money lost by average consumers, it is clear that a tightening of standards within accounting practices was needed. California recently answered this demand for stricter enforcement of ethical accounting practices. According to a recent article from the Central Valley Business Times, "accounting firms in California will be required to undergo peer review, Certified Public Accountants will take additional continuing education in ethics, and consumers will be able to watch live webcasts of California Board of Accountancy meetings" (Central Valley Business Times, 2009). This ensures a degree of public accountability in terms of the accounting practices of corporate businesses. Peer reviews help enforce strict regulation of accounting practices in order to keep California businesses acting ethically with regard to their responsibilities to shareholders. Webcasts keep the public informed and the proceedings transparent, ensuring that companies will be motivated to provide ethical accounting practices to avoid publicly damaging their reputations.
Peer Review and Continuing Education Requirements
"Under the peer review law, all California firms providing accounting auditing services will be required to undergo a periodic peer review" (Central Valley Business Times, 2009). The article also describes how the bill requires California CPAs to continually take new courses, thereby providing them with the latest in ethical accounting practices and policies. This ensures a more regulated and up-to-date methodology for California firms.
References
Central Valley Business Times. (2009). California tightens accounting standards. Retrieved January 14, 2009, from
Duska, R. F., & Duska, B. S. (2003). Accounting ethics. Wiley-Blackwell.
Sarbanes-Oxley.com. (2002). Sarbanes-Oxley Act of 2002. Retrieved January 16, 2009, from
Always verify citation format against your institution’s current style guide requirements.