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AICPA And The Code Of Ethics In Auditing

925 Words4 Pages

The auditing standards require that the auditors execute their duties within the confines of the regulating standards. However, sometimes the auditors are faced with the ethical dilemmas that can compromise their ethics. The code of ethics governs the behavior of the CPA practitioners and thus they should ensure that they adhere to them. Some of the codes of ethics which govern the behavior of the CPA practitioners are: Integrity: This aspect demands that the auditors should act honestly and truthfully when providing the auditing services to their clients. Confidentiality: All auditors either external or internal owes the client a duty of respecting the value and ownership of information they obtain from the client, and they should disclose that information without the consent of the client, where there is a legal obligation to do so or a professional obligation. Independence: The auditor …show more content…

One of the ways to safeguard the confidential information of La Mancha is to adhere to the AICPA ethical standards. AICPA requires all professional accountants to uphold integrity, confidentiality, and independence principles. The confidentiality principle states that professional accountants should not disclose private client’s information that is obtained in the delivery or discharge of their professional duties for third party’s benefit. The information on La Mancha’s intention to purchase the store was gained in the course of delivering accounting services to the firm and therefore, it is confidential information. Quixote would use it for their benefit if it was revealed. Therefore, the observance of the confidentiality principle will deter disclosure of the information to Quixote Electronics. By putting in place safeguards to avoid the conflict of interest arising from this situation, Michael should consult another professional for the best outcome of this

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