Accounting 557 Assignment 1
Professor Alfred Greenfield
27 October 2013
Many organizations have been in the news over the past few years due to accounting ethical breaches that have affected their customers, employees, and the general public. I searched the Internet to locate a story in the news that depicts an accounting ethical breach. I selected Krispy Kreme. I enjoy their hot donuts and was curious to learn more about how they played with the numbers. For some reason I always want to dig into the trickery behind the manipulation of financial statements.
When we get right down to it playing games is what happens. Someone comes along and they think ...view middle of the document...
We will review recent ethical breaches from a business and government standpoint. We should keep in mind that the U.S. government is the world’s biggest employer. However, to be fair we must remind ourselves that we are no better than the businesses and government agencies that lie, steal and cheat. When we judge others we must also judge ourselves. We are all the same when it comes to the human propensity to lie, steal and cheat if we think we can get away without being discovered.
In America we care about ethics. We care about what is right and what is wrong. The United States was formed based upon Christian ethics and principals summed up in the Golden Rule advocated by Jesus Christ. While corporations and governments are technically “people” they are rarely treated as harshly as private citizens when the rules are broken. When corporations, including government entities, have committed unethical acts, historically they have never been held to the same level of accountability as we are held as individuals. It can be argued further that people receive the greatest punishments when caught. Businesses receive a lesser punishment and governments are rarely held accountable at all for their transgressions and incompetency. What is the reason for this triple standard?
If you are a cynical sort then maybe you want to believe unethical malfeasance is overlooked because of the contributions politicians receive. I am also cynical but the reason many organizations (business & government) go unpunished, or under punished, is more complicated. What would happen if every organization involved in wrong doing was dissolved and destroyed like Arthur Anderson was following the collapse of Enron in 2002? What if the IRS, the EPA, the Bureau of Indian Affairs were all shut down because of their past abuses of power and failure to properly track and administer the funds entrusted to them?
Whatever the reason for the triple standard between punishing people crime, punishing corporate crime, and punishing government crime, we should start by asking if the U.S. government really cares about non-violent crime. Even though we have very strict regulations on everything from money laundering to banking transparency, banks like Standard Chartered and Barclays have took hits for corporate crimes. Bribery allegations, fines and settlements have hurt businesses such as Siemens, KBR, and Alcatel-Lucent.
We need to understand that when company officials, or government officials achieve power over others, there will be some who will abuse the trust they have been given. Internal controls and locks only keep honest people honest. People run corporations and the government. People will skirt the law if the potential for gain appears to be great and the risk of being caught appears small. Human activity, businesses and government included, is based upon capital allocation and a risk-reward analysis; if the profits to be gained from cheating outweigh the...