Guidelines for Accounting Ethics and Career Protection
By Richard J. Campbell
Copyright 2006, Revised 2015 Richard J. Campbell
Notice: This article may be freely used by other instructors in their classrooms, providing the author is notified by an email to maito:Campbell@rio.edu
Revised June 20, 2015
These guidelines are merely suggestions and are not to be taken as legal advice. In fact, just as it is advisable for everyone to have a personal physician, you should have a personal attorney. Make sure your attorney is familiar with the Sarbanes-Oxley Act.
They are not in any particular order of importance or relevance.
1. If as an accountant you are asked to do something unethical, TELL someone at a level above your pay grade. Depending on the seriousness of the issue, you may want to make a low-key assertion to the superior. As additional protection, you should maintain a diary – AT HOME. If, for example, you are asked to make a journal entry that you disagree with, you should place a memo in your office file with something to the effect – “Authorized by Mr. CFO and Mr. CEO on this date in this office meeting”. You should make a copy of that note and place it in your personal “Trouble File” and label this “Notes for my personal attorney – Mr. Whis L. Blower”. Presumably, this will ensure that the attorney-client privilege, attaches.
2. At company parties and events, do not drink to excess. Do not use recreational drugs.
3. If you are single, do not date any co-workers. If you are married and date coworkers, you may lose half your personal assets as well as your job.
4. Maintain a professional demeanor by avoiding profane language.
5. Enron executives made a habit of visiting “Gentlemen’s Clubs”. If you are invited, tell the person inviting you that you are allergic to smoke and cheap perfume.
6. Maintain a personal credentials file. Most companies will not give written or oral letters of recommendations for prior employees. However, if a boss commends you on a good job in a letter or email, keep that commendation on file for future personal use. Become active in professional organizations OUTSIDE your company. Some recommended organizations to accountants include the Institute of Management Accountants (IMA), the AICPA, Toastmasters, and industry specific accounting groups. Try to strive for a leadership position in at least one group. Keep your resume continually updated. It is important to maintain a professional profile on Linkedin.com. Be sure you keep your profile continually updated. Share your expertise in postings to Linkedin, making sure that you do not disclose any confidential company information.
7. Maintain professional competence, by continuing professional education, beyond the minimums specified by professional certifications. And try to achieve as many professional certifications consistent with your job aspirations. Try to write an article for a newspaper or magazine. Give speeches to professional groups.
8. If an Enron-type disaster is looming in your company, bail out as quickly as possible. As you are leaving, call the partner-in-charge (or manager) of your audit. Tell that person about your need for another job and state in a low-key manner, that there is a “little water in the inventory” or that a major customer is going bankrupt and the bad debt allowance is a little low. At that point, your problem becomes the problem of the auditing firm. Well – other than the problem of finding a job.
9. Live below your means, and maintain an emergency fund to survive company implosions.
10. Buy an umbrella liability insurance policy from your insurance carrier. For as little as $100 per year, you can buy insurance that will give you $1,000,000 coverage for slander and defamation. Buy professional liability insurance.
11. Do NOT attempt to secretly tape-record any conversations. This may be illegal in your state.
12. Before you accept a job offer, perform a “due diligence” review of your prospective employer’s management/ Just as your prospective employer would check your references, you should check out the reputation of the prospective management.
13. You should be aware, as an accountant, that you must maintain confidentiality in respect to company information. Discussing confidential company information with people outside the company may result in dire consequences. In fact disclosing some confidential company information to people within your own company can also result in problems.
14. Be wary of accepting any gratuities from outside third parties such as vendors and customers. Most major companies mandate that employees sign conflict of interest agreements that inhibit the ability to accept even small gratuities, such as calendars and free lunches. If your company does not have such a policy, you also should politely decline any gratuity.
15. Most major companies have detailed, written job descriptions for their positions. Be aware of your own job description and its provisions. Also be aware that most job descriptions have one final job requirement that is an open-ended “anything-else-the-boss-wants-his-subordinate-to-do-requirement”.That open ended requirement can lead to disciplinary action if the boss chooses to do so. Make sure that if you have the RESPONSIBILITY to do something, that you have the AUTHORITY to perform activities consistent with that responsibility. If, for example, the totally incompetent son of the president works in your department. Do you have the authority to fire the president’s son? If you don’t, you are in an untenable position and should look for another job.
16. Never assume that an email is confidential. Set your email client software to delay awhile before sending an intemperate email. Avoid using language such as “Let’s Kill the Competition!” This might be meant only as cheerleading-type exhortation, but in the hands of an opposing attorney might sound incriminating. Never assume that because you have hit the “delete” key on your computer, that a file is gone forever.
A skillful forensic analyst can recover deleted files. Be aware of your company’s records retention policy. Destroying files prematurely may be a crime if they are subpoenaed. Keeping files longer than necessary may provide ammunition to opposing attorneys in litigation.
Copyright 2015, Rich