Navigating Ethical Dilemmas: Upholding Integrity in the Accounting Profession

Ethics lie at the heart of the accounting profession. Every number reported, audit performed, or financial decision made carries with it a duty to act with honesty, fairness, and integrity. The presentation, “Ethical Dilemmas of Professional Accountants,” shed light on the vital role of ethical principles in protecting public trust and ensuring accountability across industries.

The Importance of the Code of Ethics

As discussed on pages 4–7, the Code of Ethics for Professional Accountants applies to all Certified Public Accountants (CPAs) in the Philippines — whether in public practice, commerce, government, education, or the non-profit sector.

This framework, founded on the International Ethics Standards Board for Accountants (IESBA) 2021 Code and adopted locally through BOA Resolution No. 55, series of 2023, underscores the CPA’s duty to act in the public interest, not just to satisfy clients or employers. It reinforces that integrity, transparency, and professional behavior are the cornerstones of public confidence.

The Five Fundamental Principles

The presentation highlighted five guiding principles that accountants must uphold:

1. Integrity – Be honest and straightforward in all professional dealings.

2. Objectivity – Avoid bias, conflicts of interest, or undue influence.

3. Professional Competence and Due Care – Maintain up-to-date knowledge and act diligently.

4. Confidentiality – Respect and protect sensitive information.

5. Professional Behavior – Comply with laws and safeguard the profession’s reputation.

These principles serve as a compass to guide CPAs through complex and sensitive ethical decisions.

Common Ethical Threats

The presentation identified five major threats to ethical compliance:

• Self-interest threat – Judgment influenced by personal or financial gain.

• Self-review threat – Evaluating one’s own prior work.

• Advocacy threat – Promoting a client’s interests at the expense of objectivity.

• Familiarity threat – Longstanding relationships leading to undue sympathy.

• Intimidation threat – Pressure from clients, employers, or peers that undermines independence.

Case studies such as “The Bonus” and “The Scammer’s Sons” illustrated how these threats manifest in real-world situations — from accepting client gifts to confronting misconduct within organizations.

Responding to Ethical Challenges

To address ethical pressures, accountants are encouraged to apply discussion, consultation, and safeguards. As detailed on pages 29–36, safeguards may include:

• Internal policies and procedures

• Independent reviews

• Ethics hotlines

• Professional consultations

When dilemmas arise, CPAs should escalate through proper channels — including the Board of Accountancy, PICPA, or legal counsel — to ensure transparency and accountability.

Promoting Good Governance

Ethical accounting also extends to promoting good governance within organizations. As defined on pages 53–58, good governance means transparent, accountable, and effective management of resources and decision-making.

CPAs, as financial stewards, play a crucial role in ensuring compliance, fostering accountability, and preventing corruption in both public and private sectors.

Ethical Decision-Making in Practice

The presentation’s case studies — from conflicts of interest (page 33) to whistleblowing (page 95) — reinforced one consistent message: ethics must guide every professional judgment.

Whether it is declining improper engagements, reporting misconduct, or resisting pressure to alter financial statements, CPAs are expected to uphold ethical standards even when facing personal or professional risks.

Key Takeaway

Ethics are not abstract ideals — they are daily choices that define a CPA’s professional credibility. Upholding the Code of Ethics strengthens public confidence, fosters transparency, and safeguards the integrity of the accounting profession.

As the presentation concluded:

Ethical competence goes beyond technical skill — it is the true measure of professionalism.