Enforcement of the Code of Ethics: A Survey

THIS PAPER REPORTS THE RESULTS OF A STUDY OF THE DISCIPLINARY CASES CONSIDERED BY THE STATE BOARD OF ACCOUNTING AND THE STATE SOCIETY IN A LARGE MIDWESTERN STATE. RESULTS INDICATE THAT MANY OF THE FINDS ARE APPLICABLE TO THE ENTIRE PROFESSION. VIOLATIONS ARE CLASSIFIED BY THE 3 CATEGORIES OF ETHICAL OBLIGATIONS. 1. OBLIGATIONS TO ONES CLIENTS. 2. OBLIGATIONS TO ONES COLLEAGUES. 3. OBLIGATIONS TO THE PUBLIC. THE DATA ACCUMULATED INDICATES THAT MOST DISCIPLINARY PROCEEDINGS ARE FOR COLLEAGUE VIOLATIONS WHILE RELATIVELY FEW ARE FOR CLIENT OR PUBLIC VIOLATIONS. SINCE THE FORMER ARE USUALLY LESS SEVERE THAN THE LATTER 2, THEY CAN BE MOST EFFICIENTLY HANDELED BY THE STATE SOCIETIES. FINDINGS SHOW THAT A CPA IS MOST LIKELY TO COMMIT A COLLEAGUE VIOLATION DURING HIS EARLY YEARS IN PRACTICE. IT ALSO SHOWED THAT WHEN THE FEW PUBLIC VIOLATIONS OCCURED, IT WAS USUALLY AN OLDER CPA.