The recent past has resulted in the establishment of significant development projects in the global regime. In the wake of these developments, various attributes of development have been witnessed in the establishment of business incentives thereby leading to enhanced performance. The attributes of globalization has been of immense influence in the development of the national economies because they have been characterized by the consideration of influencing the performance of the economy. Over the period, the attributes of regional trade was hindered by the enactment of regional boundaries a, however, the establishment of globalization has ensured that trade can be conducted across the regional borders because this aspect leads to the enhancement of development. With regard to the establishment of global businesses, the aspects of ethical standards have been significantly compromised because of the diffusion of cultures. Increased participation of the members from different locations has the aspect of reducing the observation of ethical practices and this leads to the consideration.
The aspect of business ethics can be highlighted as a form of professional ethics that has the function of examining ethical principles the moral problems experienced in the business environment. The attributes of ethical conducts and provisions in business are extremely ideal and is common to all the aspects of the businesses and other corporate organizations. In reality, the consideration of business ethics consideration can be divided into two categories that include normative and descriptive dimensions. Normally, the establishments and performance of business incentives are based on the consideration of other factors rather than the establishment of profitability. In this attribute, profitability is a monetary method of demonstrating and measuring the performance of the business incentives. However, another leading aspect of measuring the performance of the incentive is to the consideration of using other channels like the establishments of sustainability and satisfaction of moral obligations. In reality, every organization is faced with the moral obligation of ensuring that moral responsibility is significantly enhanced and this leads to the realization of ethical standards. According to the sentiments raised by Adam smith, it is vital for the leading corporations and governments to initiate conduction of measures that enhance realization of the existing norms in the community because failure to establish the realization of these norms results in the consideration of unethical practices. Ethics in business is beneficial because it regulates prevalence of the behaviors in the corporate environment. In the wake of the rising realities, it is ideally possible for business in the economy to be ethical in the undertakings because the systems of the market adopted are some of the ideal strategies adopted to enhance realization of ethical practices. The establishment of the business incentives is based on the consideration of identifying the needs and wants of the consumers and also meeting the increasing needs of the suppliers. In order to achieve this, the organization must engage in the establishment of ethical practices as this will influence the consideration of the growth objective. On the other hand, growth and expansion of the business incentive is based on the provision of busies incentive to the beneficiaries and ideal effects to the society. The attributes of social responsibility has been highlighted as the modern aspect of identifying the ethical standards of the business incentives and this consideration has been used to force other corporation out of the market. The attribute of social responsibility is largely determined by the satisfaction of the society and it leads to the increase in organizational acceptance by the community thereby raising attributes of support to the vision of the organization.
Practical difficulties in attaining business ethics in the modern economy
The aspects of development received in the present economy have rendered realization of ethical practices significantly hard because the practices have resulted in the establishment of factors that disobey the morals of the organizations and the customers. Some of the leading attributes that has enhanced reduction in the consideration of ethical practices involves the consideration of the quest for financial gain. Even though most organization have that attribute of working towards the realization of profits, the profit incentive has led some managers and executives towards the attribute of engaging in unethical conducts and this is detrimental for the performance and survival of the businesses. This consideration has resulted in the loss of funds and significant alteration of prices of various goods and services. In this regard, the attribute of behavior leading to the alteration of the organizational policies is the resulting attribute from the deviation in the norms. The aspect of unlawful generation of profits I the organization is a vice that results in realization of lose and the organization must identify the ideal measure of enhancing corrective measures to ensure that the losses occurring due to the aspect of vice domination is eliminated.
Analysis of various organizations has reveled that various managers have been compelled into committing unethical behaviors due to the prevalence of loses in the organization. The motive of the organization as stipulated in the mission statement is to realize profits. In this regard, continued realization of losses is an incentive that may compel the managers and other executives to change their plans and deviate from the established organizational regulations because of the increasing pressure form the shareholders. The shareholders are always of on the verge of demanding for an increase in the value of their investments and this provides an incentive for the manager’s to continue working in the organization. Therefore, failure to realize the expected profit is detrimental because it results in demotions of the managers and this aspect can propel them to engage in organizational vices with the aim of raising money for the organization.
Greed of the accountants and auditors is has also been stated by significant number of organizations as one of the leading causes vices in the society. In reality, the accountants are charged with the responsibility of ensuing that financial issues in the organization are well initiated and this leads to the consideration of adopting the transparency incentive of the organization. Certainly, the mission statement of the organization and the objectives highlights ethical practices that must be conducted by all the employees in the organization and these are stated in the code of conduct. In view of this, embezzling of funds by presenting false financial information is an organizational vice. Ethical accounting conduct requires the establishment of accurate financial standards that are used to reflect the true financial position of the firm. Over the period, the presentation of false financial statements has been on the rise and it has jeopardized accounting position because it relents challenges the moral depiction of the organization.
Role of forensic accountants and auditors
Over the period, the consideration of establishing accuracy in the illustration of the financial records is extremely crucial because this has the effect reflection on the profitability of the organization. Certainly, the aspects of profitability are extremely crucial for the organization and the depictions from the financial statements should reflect on the aspects of true financial position of the firm. It is the duty of the accountants to prepare credible financial statements that depicts the true financial performance and status of the firm because this will reflect the actual value of the shareholder benefits. However, the recent past has witnessed emergence of ideal violations of the ethical practices in the accounting profession and this is characterized the prospects of accountants engaging in the practices that aims at satisfying their selfish interests. The conduct of most accountants and auditors has resulted in the violation of the business code of ethics and this has prompted the establishment of the services of forensic accountants.
Forensic accounting is the specialist practice that is concerned with the practice in the area of accountancy and it involves the aspect of describing the financial engagements with the aim of correcting the disparities in the areas of financial departments. The development and usage of forensic accountants is based on the attribute of correcting the disparities that arise due to the concentration of the vices in the organization. Over the period, analytical results have pointed out that cases of financial adversities are on the rise and this calls for the enhancement of the corrective measures and one ideal corrective measure for the organization is to employ the services of the forensic accountants because they have the capacity to discern and ascertain the attributes of financial disparities in the organization. Certainly, the establishment of the forensic accountant services is to check and counter the financial records prepared by the accountants with the aim of highlighting financial defaults in the organization. Therefore, it is crucial to note that the role of forensic accountants and auditors is to highlight the cases of financial discrepancies in the organization. Certainly, this aspect is considered as one of the organizations ethical standards because the organizational must disclose accurate financial statement to the general public.
Even thought he financial accountants have the roles of ascertaining the attributes of financial negligence, these professionals are also accorded other duties in the organization that may range from ensuring conduction of ethical accounting practices to the aspect of detecting bankruptcy, insolvency and reorganization. The other roles of the forensic accountants and auditors in the organization include the establishment of the ethical practices in the organization and this includes the conduction of different practice like;
- The aspect of ascertaining economic damages calculations and also establishing the nature of loss. In this category, losses can be classified as tort or just the breach of contract.
- The cases of post acquisition disputes like the earn mounts and breach of contracts initiated by warranties.
- Insolvency, bankruptcy and reorganization.
- Business violation
- Security frauds in the various organization and finally, computer forensic.
Additional provisions have highlighted that forensic accountant specialize in the rectification of professional negligence cases where they address the work of the other professionals. The aspects of reducing ethical practice in both international and local organizations have resulted in the establishment of this centre. The consideration of the operations of the business organizations and the nature of their establishment in the modern economy should be in accordance with the ethical practices depicted in the mission and objectives. Another incentive that leads to the consideration to the ethical practices is the aspect of enhancing significant influence on the societies. In reality, organizations and corporations have an obligation of ensuring g that the morals, culture and ethics of the society are significantly enhanced because failure to do this will symbolize failure of the organization. Forensic accountants are usually concerned with the attribute of providing personal opinions about the work done or the reports compiled in the organization. Certainly, the duties of these professional officers is to answer ideal questions bout the issues that raise ethical concerns in the organizations and therefore, their role is to enhance the conduction of ethical practices in the organization. Additionally, it is extremely to note that the field of forensic accounting is a broad profession and is therefore classified into various attributes with the basis of ascertaining the various roles to the organization. Some forensic accountants specialize in the forensic analytics which is concerned with electronic data and are therefore capable of ascertain the magnitude of the financial fraud. The considerations of these incentives have the sole purpose of enhancing the observation of ethical practices in the business. With regard to this, forensic analytics is concerned with the attributes of data collection, data preparation, data analysis and data reporting. Some of the most ideal aspects for applicability of this incentive are the conduction f analysis on the employee purchasing card and representation of the imp rest system in the organization.
Over the period, the establishment of the performance of business has always considered the contribution of the internal auditors and further comparison done through the consolidation of the services of forensic accountants that are hired from the external sources. This incentive is ideal because it enhances the establishment of ideal accuracy of the financial statements.
Pressure of reporting false financial statements by the accountants
The attribute of preparing accurate financial statements that depict the true status of the firm is the absolute consideration and the role of the accountant’s in the organization. However, there are some situations in the history of the firm that the accountants are faced with the pressure of reporting wrong financial documents to the authorities and managers. Even though this is unethical, the managers sometimes recommend that false information about the financial statement of the organization be prepared to enable the organization secure loans from the financial institutions and this consideration s not beneficial because it leads to the conduction of unethical problems. This consideration has adverse effects because it enhances realization of the fact that the conduction of unethical practices inn the organization may result in the decrease of organizational earnings. Based on this analysis, the unethical environment is the bank loan acquisition and the attribute of this reality leads to the consideration of engaging in unethical behavior. Given the scope of this incentive, the auditor or the accountant may be under the pressure to commit the act even though they have the realization of this activity being unethical. In this regard, accounting culture and norms are in complete controversy with regard to the consideration of pressure and unethical behaviors.
Over the period, various organizations have devised measure of alleviating the expense of paying taxes at the end of the trading period. The provision of the basis of the organizational establishment has the set of rules that states that taxation rules must be observed and this is listed as the ethical code of conduct for the member s of the organization. However, the aspect of alleviating taxation has become the leading incentive for some of the organizations because they instruct their auditors to provide false information in the financial statements with the aim of reducing the amount of taxations. The ethical standards of accounting and organizational management have special instructions with regard to the consideration of disclosing correct information during the representation of the financial records. Taxation has always been viewed as an unnecessary expense by other business managers and to that effect, they have initiated measures of ensuring that the organization does not provide the payment of the full taxation. This incentive is done through the attribute of instructing the auditors and the accountants to provide wrong information during the preparation of the financial statements that represents the organizations. This preparation is considered by the attribute of under representing the organization through the attribute of failure to disclose some of the leading asserts in the organization. Even though this practice can be considered to be unethical in the accounting profession, the accountants sometime engage in the conduction of this incentive because of the pressure accorded to them by the management. In this regard, it is extremely crucial for the managers various business organizations to enact the practice of ethical practices in the organization. These ethical practices inclusive attributes of full discloser in the financial statements.