Introduction:
Ethics is first of all, the quest for, and the understanding of, the good life living well, a life worth living. It is largely a matter of perspective: puffing every activity and goal in its place knowing what is worth doing and what is not worth doing, knowing what is worth wanting and having and knowing what is not worth wanting and having.
The purpose of ethics in business is to direct business man and women to abide by a code of conduct that facilitates, if not encourages, public confidence in their products and services. In the public minds the work of an accountant must be faultless in execution and principle. "Throughout its history, accounting has been a moral discourse partially reflecting the moral order of the world in which it was practiced" (Verschoor 2002, 28).
Relationship among the FASB, SEC, and PCAOB:
The financial health and economic welfare of global corporations is at stake when it comes to accurate financial reporting. Investors won't stand for a repeat of Enron, Tyco or recent allegations in reporting improprieties by Fannie Mae. In order to establish regulations and statutory liability for accountants Government established or sponsored several regulatory body in early 1900s such as,
1. Institute of Accountants and Bookkeepers (IAB)
2. American association of Public Accountants
3. SEC established in 1930s
4. Committee on Accounting Procedures (CAP) in 1939
5. Accounting Principles Board in 1959
6. Financial Accounting Standard Board (FASB)
7. Public Company Accounting Oversight Board (PCAOB)
Presently following three regulatory bodies control and regulate ethics, principles, and rules. They collectively work together to regulate those policies.
SEC mission is to protect invest ...