Accounting Credibility the Accountability Failures Term Paper

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(5) Auditors and CPAs should consider several ways that the Sarbanes-Oxley Act and SEC implementation rules as a whole impact accountants and work closely with regulators to address these effects. (6) Public accounting firms need to reconsider external auditors' participation with their client's internal audit function and control structure. This reporting on the internal controls can be very useful and add value to the integrity and quality of the financial reporting process. However, management accepts full responsibility for the design and maintenance of the adequate and effective internal control system. (7) Auditors should advise their clients and make recommendations for the appropriate disclosures of financial information. A more timely, relevant, objective, and transparent financial reporting process should improve the quality, integrity, and reliability. (8) it is necessary to use more effective and objective audit procedures and related standards to improve audit efficiency. The role of independent auditors on financial statements is not clearly defined and understood by the investing public. (9) Auditors need to continually focus on anti-fraud education and training programs for the audit staff and clients. (10) the accountants must assist clients to combat fraud, particularly financial statement fraud, by employing management and anti-fraud programs and controls. (11) Auditors must be skeptical, alert, professional, and inquisitive and understand the public trust in their profession and why they are licensed to serve as auditors. (12) Auditors need to work closely with accounting organizations to improve the timeliness, reliability, and transparency of financial reports.

Finally, in order to rebuild the status of the accountant field, it is essential for more than just today's professionals to learn about ethics and their role in accountability. By the time they are hired, entry-level accountants should have an understanding of what is expected of them and how their own values compare to these expectations. This would include:

Offer student internship opportunities as part of the higher education curriculum. with hands-on experience for optimum learning.

Develop comprehensive practice sets and case-study scenarios with a solutions manual. Many accounting educators do not use traditional practice sets, because many available programs are either outdated or difficult to follow.

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Comprehensive case-study scenarios with real-world data encourage active participation, communication and critical-thinking skills.

Professional ethics concepts and practical implementation strategies must be integrated throughout the accounting curriculum. Of course, unless these values are reinforced in the workplace, the academic effort will be futile (Kranacner, 2007).

A large number of investors who were burned in Enrons and Andersons were just ordinary U.S. investors who wanted to participate in financial markets. Unfortunately, they had their fortunes and retirements tied up in the performance of the stock market and financial markets. For a while, these investors saw some amazing days. Then it all came crashing down. This is not something that the average person is going to forget. It will take considerable time before the fear passes and people go back to believing in the accounting field.

In the long run, the accounting profession needs to help modernize and expand financial and performance reporting models as well as attest and assurance practices, including the use of continuous auditing practices. More immediately, accountants and auditors must integrate best practices into their daily routines. They must also put the public interest before personal interest; do what is ethically right and not just legally permissible; be concerned about both fact and appearance, especially when it comes to independence issues; and recognize that continuous improvement is essential. Maintaining public trust will require every participant in the chain of corporate reporting to put into practice the values of transparency, accountability and integrity (Walker, 2005).

Kranacher, M. (2007) 'It's the Public Trust, Stupid 77(3): 80-81

Melancon, B.C. (2002), "A new accounting culture: a speech made by President and CEO of the American Institute of CPAs to the Yale Club in New York," September 4 available at www.aicpa.org/news/2002/p020904a.htm

Haberman, L.D. (2005) NASBA: Focusing State Boards on Revitalizing Public Trust

Journal of Accountancy. 199(2) p. 74-75.

Rezaee, Z. (2004) Restoring public trust in the accounting profession by developing anti- fraud education, programs, and auditing Managerial Auditing Journal. 19(1): 134-148

Walker, D.M. (2005) Reclaiming public….....

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