We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy

Impact of Unethical Behavior Article Essay Sample

The whole doc is available only for registered users OPEN DOC
  • Pages:
  • Word count: 540
  • Category: finance

Get Full Essay

Get access to this section to get all help you need with your essay and educational issues.

Get Access

Impact of Unethical Behavior Article Essay Sample

Potential acts leading to unethical practices and behavioral in accounting is evident. These acts are in violation of the Sarbares Oxley Act of 2002 (SOX). A recent article on the student website is reviewed to identify potential factors leading to unethical practices and behavior. The article analyzed is called “Becoming a More Relational Firm in the Post-Sarbans-Oxley Era”.

As expressed by the article, the effects of SOX has been considered by companies in which use auditing services as their main source of business (Jelinek, Jelinek, 2010). SOX has caused agencies to have a strong battle obtaining clientele. The SOX act has changed provisions in which disallow an agency to sale services directly to company personnel (Jelinek, Jelinek, 2010). This has resulted in agencies having to go an outside committee to sale services or products (Jelinek, Jelinek, 2010). The act also requires the auditor agencies to resale from services after 5 years and disallows them to seek employment with a previous client within of a year of last audit (Jelinek, Jelinek, 2010). These new rules have caused the agencies to have very strict rules of operation procedures. With the information obtained in the article, is has been relevant that auditing agencies are having difficulty rendering services. So if auditing agencies are not doing auditing then companies are use internal auditors. With internal auditors the unethical practices and behavior chances have increased.

These are however situations even with an auditing agency that can lead to unethical practices and behavior. Thus misuse of funds received, is a type of unethical practice. Potential scenarios in which unethical practices and behavior can be encountered is identified. When funds are used for items other than authorized, the funds use is unethical. A situation that could lead to misuse is when a company is short of funds in one area and to finance another activity, the company uses other funds. This leads stock-holders in a direction of misconception of funds, thus causing a false picture of financial health. Another situation of unethical practice and behavior is the hiding of liabilities or debt. When financial statements do not report a debt or liability, again companies financial health is misrepresented. The practice of hiding liabilities or debt could be to make the company look better to investors or creditors. The neglect of information would cause debt to income ratio be more favorable.

In summary an article was analyzed. The article offered information pertaining to auditors having to change methods to become complaint with SOX. With the strict procedures, the auditors are not rendering services as much as before act. Auditors might decrease sales because companies have chosen to use internal auditors to detour from dealing with the changes. This being said a company could have potential risk of unethical practice or behavior. When this happens unethical practices and behavior will be caught in a manner that has already of cause long-term effects. To improve accounting practices, auditors of outside business will need to be hired to be able to catch misuse of funds and lack of reporting liabilities.


Jelinek, K., & Jelinek, R. (2010). Becoming a more relational firm in the post-sarbanes-oxley era. The CPA Journal, 80(9), 64-64-67. Retrieved from http://search.proquest.com/docview/756960959?accountid=35812

We can write a custom essay

According to Your Specific Requirements

Order an essay

You May Also Find These Documents Helpful

Studying accountancy and finance

Studying accountancy and finance in the UK universities is a great opportunity for me as they are recognised for having an international excellence in both teaching and research. On top of that, the UK hosts strong accounting and finance professional bodies, which lead the world in terms of the development of accounting standards and drives me wanting to study in the UK. I have always...

Shareholder wealth maximization

Corporate Goals: shareholder wealth maximization. Explain the assumptions and objectives of the shareholder wealth maximization model. Shareholder wealth maximization is considered as a fundamental model that guides the half of the world’s market and corporations. As stated by Eiteman, The Anglo-American markets are of the view that the firms should follow SMW. As discussed in Chapter 4, Shareholder Wealth Maximization model assumes that in order...

Manage budget and financial plan

A budget is an estimation of revenue and expenses over a specified future period of time. It is compiled and re-evaluated on a periodic basis. The master budget is the aggregation of all lower level budget produced by a company's various functional areas and, also includes budgeted financial statement, a cash forecast, and a financing plan. A master budget is the central planning tool that...

The key elements of the financial plan

One of the fundamental tools used in managing account, profit forecasting and pricing strategies is definitely the “break-even analysis”, that can be defined as “a technique for analysing how revenue, expenses and profit vary with changes in sales volume or simply it is the analysis that enables any professional organisation to determine the break-even point”. The “break-even point” or BEP can be considered as “the...

Standard Costing: Meaning and Objectives

“Standard costing” is a traditional cost accounting method and management tool in which “standard costs are employed to value the overall cost of a production”. A “ Standard cost” can be defined as a “predetermined/estimated future cost of performing an operation, producing a good or offering a service”.  As explained in our workbook, using standard costs enable managers to identify in advance material, labor and...

Get Access To The Full Essay
Materials Daily
100,000+ Subjects
2000+ Topics
Free Plagiarism
All Materials
are Cataloged Well

Sorry, but copying text is forbidden on this website. If you need this or any other sample, we can send it to you via email.

By clicking "SEND", you agree to our terms of service and privacy policy. We'll occasionally send you account related and promo emails.
Sorry, but only registered users have full access

How about getting this access

Become a member

Your Answer Is Very Helpful For Us
Thank You A Lot!


Emma Taylor


Hi there!
Would you like to get such a paper?
How about getting a customized one?

Couldn't Find What You Looking For?

Get access to our huge knowledge base which is continuously updated

Next Update Will Be About:
14 : 59 : 59
Become a Member