The Ethics of the Accountancy Profession - Survey Opinion

Many will remember the headlines in October 2001 – when the Enron scandal broke in the news.

What followed was not only the bankruptcy of the company, a hefty prison sentence for CEO Jeffrey Skilling and other employees, but also the de-facto dissolution of Arthur Andersen – one of the Big Five.

Cited as the biggest audit failure in history, the accountancy profession, which had always played a 'behind the scenes' part, was now front of stage. The ethics, not just of Arthur Andersen, but of the whole profession has been scrutinised under a very bright light since.

Seventeen years on, has that bright light meant the profession is unlikely to be committed for a similar offence?  I wish this was the case but recent research by and reveals a rather shocking picture; more than a third of accountants surveyed admitted they are aware of a senior staff member at their current workplace who has made a decision to deliberately choose a commercial result for the company, even though the decision could be regarded unethical.

In addition, half of all accountants and auditors surveyed have been pressurised, or know someone who has been pressurised, by manager or a partner to ignore an adjustment that should have been made to a set of accounts. Nearly a quarter of accountants (22%) believe that more than 25% of the profession have helped their clients create a set of deliberately misleading accounts. With a further 16% believing 10-20% of the profession are involved in shady activity and a further 24% believing the percentage involved is between 5-10% of the profession.

When asked for details, many were forthcoming and these are just a few examples;

“The bank started lending to low income earners who were left with insurmountable levels of debt”

“The senior manager advised on how to escape tax authority”

“Actions [by the accountant] led to misleading reports to board”

“I pointed out serious accounting/legal violation by senior executive and was penalised for doing it.”

Yes, you read that last line right - an accountant or auditor was doing their very best to ethically adhere to compliance and yet that person was punished.  There is little wonder the research stats are what they are with accountants having to work in environments that are wholly conducive for further accountancy misconduct. The nutshell - the whistle-blower will suffer the consequences. Indeed, nearly two thirds (65%) of accountants and auditors believe businesses do not do enough to protect an employee against victimisation or dismissal should they report the misconduct of a colleague.

Towing the ethical line brings all sorts of problems it seems, whether this is about losing their job, losing a client for speaking up, risking promotion or damaging their career reputation.

Rather than let another ticking corporate scandal go off, let’s get to the heart of the issue for the profession – to create enforceable code of practices which ultimately encourages the right working culture to report fairly and without fear.


Please feel free to get in touch to discuss the survey results further or receive a full copy of the findings.

See previous survey results here


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