Accounting Ethics Systems: Deontology and Utilitarianism

Utilitarianism and Deontology in the Accounting Profession
Name
Institution
Utilitarianism and Deontology in the Accounting Profession
Introduction
The accounting profession forms an integral part of any business organization as it deals with the management of finances necessary for running or rather maintaining a particular business entity. As such, the professionals should embrace and exhibit good moral and ethical behavior in their duties for personal development in their respective departments. With respect to the importance of the accounting services to any business organization coupled with the recognition of the numerous ethical dilemmas facing the accountants, it is imperative to analyze the ethical belief systems employed by the profession in its entirety. An accounting organization or firm may operate through the utilitarian ethical theory or the deontological belief system as guidelines for their ethical and moral conduct in executing their accounting operations. A descriptive analysis of the two belief systems based on their efficacy in delivering on both the organization’s cultural demands and meeting the stipulations AICPA Code of Professional Conduct facilitates the recommendation of the most appropriate or efficient ethical belief system for accountancy.
Ethics in Business
The business code of ethics or the ethical code of conduct as it is also known often outlines the ethical or moral platform upon which the organization operates and that further demands the compliance or adherence to the stipulated guidelines by all the covered personnel in carrying out their diverse duties (Klein, 2015). The code of ethics followed by an organization could be based on the cultural orientation of the organization or simply stemming from the regulations and stipulations of the governments or other regulatory authorities. Additionally, most of the values enshrined in the ethical code of conduct are considered the accepted behavior of the society and may slightly differ with the professional code of conduct, which may be regional or universal. Accountants face such conflicts of interest as they depend on both the professional code of ethics and their organizational code of conduct in the delivery of their services, which may also be influenced by the organization’s cultural alignment. It is, therefore, necessary to maintain an ethical system of beliefs that will act as a guideline for business organizations in carrying out their daily activities with integrity and the acceptable moral behavior. It is in line with meeting the society’s demand for integrity and transparency that business organizations highlight given set values, beliefs, and principles as the basis for performing their daily activities.
Ethical Belief Systems in Accounting
The costs of ethical misconducts in any business organization outweigh its benefits, which are only short-term and beneficial to only a selected few. It is without a doubt that the accounting profession plays a significant role in maintaining the stability of such business entities for the greater good of the society and as such requiring the strict adherence to the ethical code of conduct in business. However, determining the set code of ethics to follow in the accounting profession could be problematic for an individual as it may involve the consideration of a wide spectrum of ideas from which the ethical codes are formed (Gaffikin, 2007). An individual’s perception of what constitutes ethical behavior or conduct in the accounting profession builds around values and beliefs held at the personal, professional, societal, and cultural levels (Gaffikin, 2007). The utilitarian and deontological ethics system provides alternative ethical values and beliefs through which accountants can make informed decisions as they discharge their duties and responsibilities. Even though the accounting profession is guided by the AICPA Code of Professional Conduct and the cultural organization of the firms through its values as enshrined in the firms’ code of conduct, it is advisable to have an efficient, ethical system to assist in making tough accounting decisions.
Utilitarian Ethics System
The choice of what actions an individual partakes board on the weighing of the cost and benefits of the said action. It is, therefore, common for individuals to take a particular course of action whose benefits outweigh the costs of carrying it out (Dolfsma, 2005). Utilitarianism focuses on maximizing the benefits gained from a particular cost of action. The philosopher named Bentham is credited for developing the utilitarian platform for determining that which is good or bad and the ethical obligation of either choosing or avoiding a particular course of action. According to Jeremy Bentham, the choice or decision of what is ethical for both the individual and the society at large should be the alternative or option that reaps maximum benefits regarding the well-being of both (Dolfsma, 2005). Utilitarianism as an ethical system for accountants is more concerned with the utility of action (good) in bringing maximum positive outcomes to the greater majority of people. In essence, ethical conduct in accounting under the utilitarian system is that which brings happiness through the maximum benefits to a majority of the stakeholders and shareholders of an organization. Though the particular action may not be ethical in the eyes of some individuals or could be in contradiction to the statutory regulations and professional code of conduct, it is the outcomes that determine the measure of goodness or rather the morality of a particular action. Determining the right or wrong of an action based on its outcomes forms one part of the utilitarian ethical theory, or belief system referred to as act-utilitarianism or consequentialism. In essence, the end justifies the means for a proponent of consequentialism as it is the value of the outcome that carries more weight and not the process.
Utilitarianism also allows for the determination of whether an action is right or wrong by validating the outcomes or consequences through the best rule of conduct, which is commonly referred to as the rule-utilitarianism (Gaffikin, 2007). In act-utilitarianism an individual’s choice of action should maximize their utility, and thus the morality of their conduct is to some extent relative to the positive consequences. However, rule-utilitarianism advocates for adherence to the acceptable code of conduct that maximizes the utility of an individual in taking a particular course of action (Dolfsma, 2005). Conformity to the AICPA Code of Professional Conduct by an accountant, for instance, serves the maximum benefit of a business entity as it increases the organization’s transparency and integrity. Consequently, the trust and confidence of all the major stakeholders increase, leading to business growth with which comes a wide range of positive rewards to both the individual and the entire organization.
It is important to understand...