Fences: A Means to Protect Accountants’ and Auditors’ Moral and Professional Competence

• In Event: Emerging Research Session IV: Ethics, Management Accounting and Governmental Accounting

Abstract

Accounting control and monitoring activities protect company assets and owners from improper actions. “Weaker humans” in high pressure situations often use self-justifying rationales to derive contrivances to skirt existing codes of conducts. While prior scandals often lead to new ethical requirements, these rules generally arise after auditors violated current AICPA dictates. We now examine religious justifications, explanations and controls that could help re-institute business ethics as a control, i.e., strengthen auditors’ own moral compasses. .

We also show how much of Christianity, Islam and Judaism contain FENCES to minimize opportunities for selecting improper conduct. For example, Christians long ago developed the concept of a bakers dozen, where customers received 13 items but paid for 12, to assure that customers received at least the “benefit of the bargain.” Islam and Judaism dictates require women to dress modestly in order to minimize improper moral conduct, just as many auditing internal control redundancies minimize potential temptations to commit defalcations and financial fraud.

To examine these concepts further we analyze the ethical, religious and auditing literature, in these six sections: (1) need for increased ethics, (2) ethical and religious affects on individuals and their decisions; (3) educating and otherwise developing proper ethical behavior; (4) religious influences on moral behavior; (5) importance and definitions of fences; and (6) implementing fences to improve morally and business activities.

Authors

• Alan Reinstein, Wayne State University

• Eileen Z Taylor, North Carolina State University