On a broader perspective, Gillan and Starks (2008) refer to corporate ethics as a system of rules, factors and laws affecting a company’s operations. Irrespective of the definition taken up, it is common for researchers to categorize corporate mechanisms into two groups; those that are internal to firms, and those that are external to firms. Ethics is charged with the responsibilities and duties of a firm’s board of directors in managing the firm in addition to the relationship they have with the firm’s shareholders as well as stakeholder groups (Duska, Duska & Ragatz 2011). Issues of corporate governance arise in a company with the presence of two conditions. First is in the event that there is a conflict of interest or an agency problem involving members of the company who might be the workers, consumers, or managers. The second condition is that the transaction costs are such that the problem dogging the agency cannot be ameliorated via contract. Another definition of corporate ethics is more comprehensive in that it argues ethics is involved with mechanisms through which a company’s stakeholders are able to exert control over corporate management and insiders in such a manner that their interests are protected (John and Senbet 2008). It is imperative to note that the term shareholders does not only refer to shareholders, but also debt holders in addition to non-financial stakeholders like suppliers, customers, employees, as well as other interested parties. A review of corporate ethics’ various definitions clearly highlights that they all allude to the presence of conflicts of interest between outsiders and insiders, hailing from the separation of control and ownership. The recent past has seen a growth in interest in corporate governance. Prevalent governance mechanisms have been questioned with intensified debates following business failures and financial scandals, and more recently, several accounting frauds of high visibility that have allegedly been perpetuated by managers (Gillan & Starks 2008). Underlying concepts of good corporate ethics Fairness Fairness refers to equitable treatment with the stakeholders in entirety. Equitable does not mean equal. It means treating each entity as much as they deserve; suppliers, customers, and stakeholders need to be categorized accordingly and afforded treatment on an equitable basis (Shleifer & Vishny 2007). Values and systems that underpin the organization need to be balanced by considering every individual with a legitimate interest in the organization and respecting their respective views and rights. Transparency/Openness Transparency alludes to the clear and open disclosure of pertinent information to shareholders as well as other stakeholders, and also entails not withholding information in the event that it may out rightly affect decisions. It means a default position with regard to the provision of information instead of concealing it, and open discussion on an issue of concern. Transparency includes all possible voluntary disclosures. Certain circumstances may however warrant the concealment of information and may be justified. They include confidential discussions about individuals, discussions regarding future strategy, and discussions that result in an agreed position that is consequently made public (Shleifer & Vishny 2007). Independence As a concept, independence is important to directors. Reports on corporate governance have increasingly stressed the pertinence of independent directors. They ought to be in a
Influence of Ethics on Audit (Author’s name) (Institutional Affiliation) Ethics connotes a system by which organizations are controlled and directed. It is a chain of relationships between the directors of a company, its shareholders, along with other stakeholders…
Final Paper Introduction The significance and the necessity of ethics and law in the field of business have long been recognized owing to the increasing unethical practices that are adopted by the business organizations. It needs to be mentioned in this context that ethics as well as laws in the business world need to be followed for the reason of avoiding possible legal accusations or procedures.
The basic objective of an auditor is to obtain audit evidence which is sufficient and appropriate in the circumstances that the financial statements are free from material misstatement. These misstatements may occur due to fraud or error. The auditor obtains this audit evidence by obtaining an appropriate level of assurance that financial statements are not materially misstated. The audit evidence thus obtained allows the auditor to report on the financial statements.
Business ethics creates a good business image in the society, increases moral of he employees and also improves the relation with customers. Ethics benefits the business and the employees. “Ethics in the Workplace can also refer to staff being reliable, punctual and work as a team with the rest of the staff and management.
the paper will include references to the moral philosophy or social issues that affect my approach to the development of this Code of Ethics. My Code of Ethics will contain the following components: statement of values, and why the principles are non-negotiable, the moral philosophy or social issues affecting my approach to ethics.
Now Samsung has become the group of companies and globally responsive for the needs of the market and core business sector including the finance, electronics, trade and services. Global success of the Samsung lies in the new management’s declaration of organizational creativity, intellectual capacity, employees’ empowerment and technological innovation.
In the preamble that has been recently published by OECD, they have stated that corporate governance signifies a set of association that lies between the management of the company, its shareholders and its board, which also involves the other stakeholders of the company.
Auditors are expected to ensure that an organization’s financial exactitude and accountability are maintained. Firms apply expert auditing as a tool to strengthen their operations through offering authenticated information that is important in making informed business choices to ensure competitiveness and profitability.
This process is performed to make sure that the entities are being traded justly and in accordance with the Accounting Standards so as their issued financial statements will not be deceptive for users.
Auditors play a role in serving public interests to ensure
The auditing process involves the auditor perceiving the propositions before him for examination. He also collects evidence and on his basis formulating the judgment which is communicated through an audit report. It is evident also that audits provide third party assurance to
2 pages (500 words)Research Paper
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