Management Research Review ​An applied code of ethics model for decision-making in the accounting

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Dinah M. Payne, Christy Corey, Cecily Raiborn, Matthew Zingoni, (2019) "An applied code of ethics model for

decision-making in the accounting profession", Management Research Review, ​https:// doi.org/10.1108/MRR-10-2018-0380

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e ethical and stand fast against the internal and external pressures that might encourage these pro
Codes of ethics provide a coherent articulation of the ideals, responsibilities and limitations of the

An applied code of ethics model ​for

an assist in guiding ethical behavior. ​Design/methodology/approach ​– ​Our model is based on
ompetence and utility, i.e. JUCI model, which is a straightforward and easily understandable eth
ccounting professional, as well as ​fi​nance professionals in general, may reference when challeng
– ​This code, the JUCI Code, represents a contribution to the literature in that its simple, but not s
ene​fi​t to busy and pressured accountants who need help in constructing independently achieved

decision-making in the accounting profession ractice of accounting. ​Originality/value ​– I​ n this paper, the authors build upon a review of eth
rofessions to construct our code of ethics for accounting professionals.

Dinah M. Payne ​and ​Christy Corey ​Department Keywords

of Management, University of New
​Values, Decision-making, Ethics,Orleans,
Accounting

New Orleans, Louisiana, USA ​Cecily Raiborn T​ exasPaper

Statetype
University,
​ConceptualSan Marcos, Texas, USA,
paper

and ​Matthew Zingoni D ​ epartment of Management, University of New Orleans, New Orleans,
Louisiana, USA
ntroduction ​According to ​Karmanska​et al. (​ 2017)​:

Professional ethics (have) become a hot topic in recent years, fueled by scandals [​...​] a
that the importance of acting ethically needed more emphasis in professional training.
Abstract ​Purpose ​– ​The purpose of paper is to supply a code of ethics that can be easily utilized by working professional in their day to day
decision making. The accounting profession plays a vital role in the functioningThe profession
of modern society.of
It isaccounting
essential that has not of
members escaped its share of scandals or its re
this profession
 accounting services needs more emphasis. Numerous and varied stakeholders have called for more ethically oriented 10.1108/MRR-10-2018-0380

professional accounting behavior in light of the scandals associated with Enron, World Com and others (​Barman, 2016​;
Cameron and O​’​Leary, 2015​). In those scandals, accounting professionals were morally culpable and,

Applied code ​of ethics model

Received 9 October 2018 Revised 17 January 2019 Accepted 5

March 2019

Management Research Review © Emerald Publishing Limited 2040-8269 ​DOI

The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/2040-8269.htm
mpanies, actively invest, or are in some other way [stakeholders] in a
MRR on of the people who could be adversely impacted by the actions of
propriate and/or illegal behaviors. Participation by accounting professionals in
s telling: the accounting profession needs to examine how best to
age of accountancy, an image that should be viewed with the highest regard by
number of people will never connect a person with the provision of accounting Further, few (or no) accounting specialties have gone unchallenged wit
nted or, worse, derived through incompetent or fraudulent accounting practice: James (2017) ​warns against aggressive accounting, indicating that it
 boost results.​” ​According to ​Karmanska ​et al. ​(2017)​, internal aand positive
external contribution
auditors, bookkeepers,
to prevent the tax root
advisors andof ​fi​nancial s
causes
accountants in practice and business and external consultants have accounting,
been pressured
which has to violate
been sorely
personal,treated
professional
in recent or
years by variou
legal mandates. Clients, owners of business or practice, directors and the board
conduct members,
of ethical line
accounting
managerspractices.
and other colleagues
have pressured accountants to act contrary to their professional judgment. Accountants occupy a unique position to make
This unique position is under assault by the pressures accountants feel to violate their personal or professional codes or legal
mandates. To bolster accountants​’ ​abilities to resist such pressures and to enhance their ethical decision-making abilities,
we believe that a relatively simple code of ethics can be constructed that will re​fl​ect the fundamental values and
requirements which form the basis of many accounting codes of ethics. Such a code could do much to diminish or
eradicate misunderstandings of accounting ethics, a laudable object as ​“​(e)thics in accounting is one of the most
important, yet most misunderstood, concerns in the world of business today (​Onyebuchi, 2011​, p. 275).​”
This article proceeds as follows. First, we discuss the vital role accounting plays in society by reviewing the accounting
professional​’​s relationship with various stakeholders. Next, we outline some of the pressures that lead to accountants​’
unethical behavior: why they engage in fraud. Finally, after we build upon a review of ethical foundations and
accountants​’ ​codes of conduct, we construct our code of ethics for accounting professionals. Our model is based on the
professional values of justice, utility, competence and integrity (i.e. JUCI model). It is a straightforward and easily
understandable ethical decision-making model that the average accounting professional, as well as ​fi​nance professionals
in general, may reference when challenged with dif​fi​cult ethical quandaries. Indeed, though not the subject of this effort,
fi​nancial professionals are also in need of more aid in achieving ethical decisions: according to ​Cowton and San-Jose,
2017​, p. 673, citing Prindl and Probhan, 1994, ​“​ethics is given little consideration within the​fi​nance literature,​” ​thus
indicating a clear need to introduce more ethics into that ​fi​eld, as well. Our code for accounting professionals, the JUCI
Code, represents a contribution to the literature in that it is a simple, but not simplistic, approach that could be of
enormous bene​fi​t to busy and pressured accountants who need help in constructing independently achieved and defensible
rational ethical decisions in the practice of accounting. Our code aims to address the dif​fi​culties encountered by
professional accountants in an effort to ease the dilemmas accountants face in light of pressures brought to bear by
stakeholders: we hope that accountants will be able to fairly easily, though of
nd their stakeholders as evidenced by many surveys about accountants​’ ​levels of
course with critical thinking, determine the most ethically appropriate Ghazaliresolution to the 2013​
and Ismail, quandaries
; ​Hagel,they 2012​encounter
). A 2012allsurvey
too by the American Institute
frequently. Global Management Accountants (CGMAs) found that 35 per cent (up from 28 pe
felt some pressure from colleagues or a manager to compromise their organizatio
The vital role of accountants: stakeholder perspective ​A stakeholder onduct is any person
(​Hagel, or ,entity
2012​ p. 22).​that
” can be positively or
negatively affected by actions of a decision-maker. Relative to accounting information, A different the 2015number
globalofsurvey stakeholders
indicatedwhothat two-thirds of 648 respond
can be affected is extensive. Obviously, a ​fi​rm​’​s stockholders (or other types of owners) and capital providers
o (1) their professional ethics or (2) tax and/or accounting (such as legislation at some po
lenders) are stakeholders, but ​Joseph (2007) ​suggests that other stakeholders who have not always been considered to
he majority of these had been placed under pressure more than once (​Lang ​et al.,​
have speci​fi​c, identi​fi​able stakes in the ​fi​rm be included. His broad de​fi​nition Given
of a stakeholder is based nature
the fairly negative in stakeholders​ ’
of the responses, it seems that the integr
legitimate claims to be informed about ​fi​rm activities and re​fl​ects thee ​“viewed
​interdependency in the economic environment and
as being at risk to succumbing to pressure exerted by colleagues, superi
the nature of human behavior (p. 55).​” ​Thus, stakeholders are not always make itknown or to
dif​fi​cult easily recognizable
reconcile ​Mintz​’​s as being​conclusion that certi​fi​ed public accoun
(2016)
stakeholders, a nebulous thought that gains clarity in speci​fi​c accounting reporting instances. More
f the public interest, and that auditors are speci​ fi​ cally,
the gatekeepers entrusted with investor
Baskerville- Morley (2004) ​identi​fi​es the government, special interest groups, the media, SEC of​ fi​ cials, individual
hat internal and external environmental pressures may be suf​fi​cient to cause ethic
practitioners, associated professional groups and those groups​’ ​disciplinary
ail. Thiscommittees,
con​fl​ict has clients/customers,
evolved over time,employees, in part, because tighter personal and busi
students and international constituents, among others, as organizational stakeholders. ​
A renas and
mong auditors, managers and clients (​Menendez Rodrigo (2016​ , p. 168)
and Mintz, 2016​). An additiona
state that even​“​the next generation​” ​should be viewed as stakeholders as they ​“​are at the core of sustainable development
and [​...​] are relevant for both societies​’ ​persistence over time and theuditors.
long-term External auditors
viability of business ​stresses of not
face theorganizations.​ ” ​Sonly
ee needing to make fair and a
Table I ​for a list of primary stakeholders and the consequences they may face if they engage in fraudulent accounting
practices, both short and long term. This list is illustrative only, but he it serves to re​fl​ect the large number and array of
stakeholders, as well as some consequences of engaging in unethical accounting practices.
Applied code ​of ethics model
The accountant​’​s ethical role: under pressure ​Professional conduct is currently of extreme importance to accountants

MRR
Table I. ​Primary stakeholders and consequences of
unethical accounting practice

Applied code ​of ethics model

 Table I.
nally. The threats included a variety of ​fi​nancial losses: the loss of
MRR yment and the cessation of the professional relationship between the
ness so public accounting ​fi​rms can remain pro​fi​table. Those auditors also need toAccountants and their ​fi​rms face​fi​erce competitive pressure to
es of the various stakeholders (e.g. client company stockholders, client company
nagers and society) (​Baskerville-Morley, 2004​). This need to generate or retain
[​...​] the strong growth of non-audit services, especially management con
hat though there were no explicit rewards for professional misbehavior, there was
On the one hand, the ​fi​rms wanted to generate pro​fi​table growth and on
ontinuing relationship​” ​between the auditor and audited. Indeed, the suggestion is when they took questionable accounting positions in their ​fi​nancial statem
ffered could indicate that the pressure accountants come under is seen as ​‘​normal
s​ tudy also indicates an even graver conclusion: some respondents had actually

To intensify the challenge to maintain an ethical professional persona, auditors have the added pressure of the investing
public​’​s expectation gap: the reality of what auditors actually do as opposed to what the public believes auditors do. As
 stated by the profession, an audit​’s​ purpose is to provide an opinion as to whether the ​“fi​nancial statements are presented
fairly, in all material respects in accordance with an applicable ​fi​nancial reporting framework​” ​to provide users with a
higher level of con​fi​dence than if the statements were unaudited (​AICPA, 2014​: AU-C §200.04). In contrast, the investing
public​’​s common misconception of an audit​’​s purpose is that auditors search for and discover any and all fraud existing
within audited client data. Given some of the recent audit failures and regardless that the majority of audits are performed
with care and expertise, that the majority of executives are honest and that the majority of ​fi​nancial statements are fairly
presented, the lack of public trust in the auditing profession looms large. This dissonance in what auditors do and what
the public believes they do is a major cause of a lack of trust in the accounting profession: stakeholders who
misunderstand the auditor​’​s charge question the trustworthiness of the source of accounting information, intensifying trust
issues stakeholders might already feel as a result of their ignorance of accounting practice in general.

The unethical initiated: why accountants engage in fraud? ​Within business organizations, accountants are the
individuals who have direct access to organizational assets. They often have the ability to override internal controls; they
are skilled in practices that would allow ​fi​nancial statement manipulation and are typically intimately aware of
organizational needs and weaknesses. ​Amernic and Craig (2010​, p. 81) state that internal accountants could be seen as
conformists (active and dependent, uncritical thinking) and passive (passive and dependent, uncritical thinking) and who
are highly ​“​prone to be in​fl​uenced by the policies, action and language​” ​of unethical CEOs or other high-level managers.
Glen (2017) ​summarizes why accountants act in an unethical way: ​“​most reasons tie back to a ​fi​nancial one as the payout,
through stock price or something as direct as stealing cash.​” ​Further, the article notes that many companies are pressured
to provide short-term results to avoid market retribution and/or loss of employees
ntolerable to accountants.
as a result of poor performance. To compound the pressure issue, accountants could also be viewed as being in more

opportunistic positions to create their own ethical dilemmas by Ethical

engaging in fraud.​The
foundations profession of accounting has several directives to help g
​Whenever accounting fraud is
Generally Accepted Accounting Principles (GAAP) or International Financial Rep
examined, it is not long before the discussion moves to Dr Donald
​ R. ​Cressey​
Rockness (2010)’​s (1972​ , p. 30)
​state that fraud triangle:
accountants pressure,
who merely focus on rule compliance may
ctions, instead
opportunity and rationalization. Pressure is an innately inherent condition felt by using the rules
humans and as the reason
exists in everyforstage
their of
unethical behavior. Thought
Maslow​’​s (1943) ​hierarchy of needs or motivations. Accountants, despite their prescribed codes of ethics, are not immune the spirit of the transactio
quivalent of ignoring transactional substance (actuality:
etter of the
from pressure to commit ​fi​nancial fraud, whether such pressure is exerted transaction),
internally from theleading
need,toi.e.distorted presentations of reality. Thus, the me
for job promotion
trictures alone (whether in the guise of GAAP,
or externally from a top level executive who wants ​fi​nancial statements ​fi​gures to meet a designated target level. Thus, IFRS,nogenerally accepted auditing
ronounced edict)
code of ethics, no matter how severe the penalties for lack of adherence, is insuf​fi​cpressure
will eliminate ient to ensure,
(​West,to2018​
the greatest
). As extent possible, honest,
previously noted, given the nature of their activities, accountants clearly havedevelopment
nformation the opportunity to commit ​fby
or presentation i​nancial
good fraud faith practitioners. ​The provisio
[Furthermore, accountants have the necessary capability, a fourth dimension suggested by ​Wolfe and Hermanson (2004)​].
In most circumstances, opportunity is seen as the dimension et ofofthe fraud triangle
directives for ethical most
accounting
​ susceptible standards.
to externalBefore focusing on a second set
modi​fi​cation, usually through the installation of human and physical internal controls.
However, within the accounting profession, the dimension of rationalization may Applied be the onecode that ​“​h​of
olds all themodel
ethics
cards​” ​to minimizing ​fi​nancial fraud. As rationalization is considered the ability to inappropriately justify an action in a
logical or rational manner to one​’​s self or others, then, practically speaking, many or all people must rationalize to some
extent and at some point, i.e. ​“​it​’​s only a white lie: I don​’​t want to ehurt someone​​D’​sefeelings.​
examined. ​Most rationalizations
George ”(2010) ​de​fi​nes businesscan be as business
ethics
categorized as self-deception, self-indulgence, self-protection, self- righteousness or faulty reasoning (​ A lbrecht,
right and wrong based on values and beliefs of the cultures that 1992​ , pp.
18-19). Rationalization is, however, more dif​fi​cult if a code of ethics manydelineates
de​fi​nitionscertain
of ethics:actions as expressly
the principles used ​“​right​ ” ​or conduct in
to govern
“​wrong​” ​without attempting to dictate actions down to minutiae. s the rightSuch and codes ​“​may ​Vinhibit
the wrong. elasquezand/or (1998​, prohibitp. 11) de​fi​nes ethics
Machiavellian-type behaviors (e.g. manipulation, opportunism)​” ​in accountants​’ ​performance of their professional
responsibilities (​Wake​fi​eld, 2008​, p. 116). For example, the preamble to the AICPA​’​s Code of Professional Conduct
calls​“​for an unswerving commitment to honorable behavior, even at the sacri​fi​ce of Thepersonal
activity of examining(​A
advantage one​
ICPA,’​s moral standards
2014​ : or the moral standards
lives and whether
§0.300.010.02).​” ​Thus, implementation of, and adherence to, codes of ethics may be the most effective deterrent tools these standards are reasonable or unreasonable, that is,
against immoral and illegal behaviors by accountants because such codes make the commission of fraud more internally

Addressing accounting as a profession, ​Velasquez (1998​, p. 7) offers that ​“​[w]e use the term ​‘​accounting ethics​’ ​to refer to
the code that guides professional conduct of accountants.​” ​Tormo-Carb ​o ​et al. (​ 2016​, p. 163) de​fi​ne ethics as the ​“​system
of beliefs that supports a particular form of morality.​”
 Mintz and Morris (2011​, p. 5) begin their discussion on the nature of ethics by referencing Greek and Latin words such as
ethikos a​ nd mores or, respectively, custom or character and manners, moral or character. These authors equate the
concepts of ethics and morals and simplify the concept of ethics by indicating that ethics relates to right and wrong.
Additionally, they emphasize the importance of ethics with regard to the effect our actions have on stakeholders. Writing
about accounting ethics speci​fi​cally, ​Onyebuchi (2011​, p. 275) de​fi​nes ethics as ​“​the systematic study of conduct based on
moral principle, re​fl​ective choices, and standards of right and wrong.​” ​He also cites ethics as it relates to auditing, noting
that auditing ethical standards are no different than general business or indeed general business ethics.
Other de​fi​nitions of ethics have also been offered. ​Youseff and Rachid (2015​, p. 4) de​fi​ne ethics as a:

Philosophical discipline that aims to apply actions and rules in keeping with the concepts of right and wrong [​...​] General ethics
aims to articulate criteria that con​fi​rm respectful behaviors in a practical situation and when making responsible choices.

They suggest as well that ideals of ethics are closely related to the concept of legitimacy and/or concepts of legality,
justice or equity. Legitimacy theory encompasses the idea that business and society exist symbiotically, as previously
noted, each owing the other responsibilities and each owing the other corresponding rights. Justice and equity can be used
synonymously, representing the concepts of fairness and reasonableness. All of these concepts can be applied to a
determination of whether an accountant has complied with not only the letter of the law but also the spirit of the law in
ful​fi​lling his professional duties ethically.

Professions and codes of conduct ​A system of self-regulation based on a code of ethics (or conduct) is one of the three
primary criteria characterizing a profession, with the other two being signi​fi​cant training and education and governmental
review and licensure (i.e. credentialing) (​Magill and Previts, 1991​, p. 5). Training and education speak to the
professional​’​s indispensable knowledge, while governmental oversight in the credentialing of accountants speaks to the
maintenance of high professional standards of competence. This element of professionalism, including legal mandates, is
also associated with deterrence of unethical behavior. Professionals are also generally viewed as having a higher level of
autonomy than non-professionals. However, such autonomy carries with it the responsibility to:
ecause countries​’​:
Serve the public good, to set higher standards of conduct for their members than those required of others, and to enforce higher
discipline on themselves than others do [​...​] (S)ociety [​...​] imposes less[c]ultural di​ff​erences
social control, often
on the condition e​ff​ethe
limit thethat ctiveness of a uniform
profession be international code of et
self-regulating and self-disciplinary (DeGeorge 2010, p. 490). within a profession as to what constitutes acceptable behavior (​ V anasco, 1994​, p. 13).

Also, codes​fi​may
Stuebs and Wilkinson (2010) ​identify two key characteristics of professions; rst, asbenoted
ineffective
above, because codal
accountants provisions
possess of are not enforced or imp
a body of indispensable theoretical and technical knowledge. Second, professions have an orientation toward service,the main purpose of the p
uch enforcement is deemed to be contradictory to
romote
asserting that these characteristics build trust among stakeholders. The the interests
premise that members of their
of members
a profession (​Tomasic
embraceand theBottomley, 1993 ​as cited i
f potentially
concept of serving the public interest is imperative and, very importantly and con​
aptlyfl​icting
in thisadvice
effort,from
key counseled individuals, different tenets amo
for accountants:
global
accountants serve the public trust (​Mintz, 2016​). Such services ​“​are professional
required by societypopulation, andarepotential
at large​” ​and dereliction
often ​“​needed to of enforcement, the ac
remedy perceived or actual ills, the relief of which will allow society to go forward​” ​(​Behrman, 1988​, p. 99). ​Bollom more easily and effectivel
rofessions) may need ethical codes of conduct that are
(1988) ​reiterates the importance of service to the public interest by stating that a primary objective of all the professions is
to serve and protect the public. These characteristics indicate that The development
accounting is, by any of ameasurement
model code bases,
of conduct for accounting professionals ​Cod
a profession.
In light of the diminution of accountants​’ ​reputation regarding rticulation of the itideals,
trust, however, responsibilities,
is also a profession andthat limitations
needs to of the collective ethic of
reestablish the public service orientation: accountants should Frankel (1989​relevant
provide , p. 110), codes embody ​“information
and reliable ​the collectivefor
conscience of a profession an
decision-makers and provide this information ethically. Trust in the accounting profession​’​s reputation and the
information accountants provide has indeed been tarnished or questioned, prompting a call Appliedto action code ​of ethics
to engage in amodel
rebuilding of trust and reputation for accounting professionals. We have chosen to answer this call in our proposal of a
model code of ethics that accountants can easily and quickly, yet comprehensively, use to make sound moral judgments.
Within their working environments, accountants (as do mostVelayutham
professionals)
(2003)face ​argues
a wide thatvariety
professional
of issuescodes
giving
of conduct have
rise to ethical dilemmas. Undeniably (​Hagel, 2012​; ​Karmanska ​ehnical
t al.,​ 2017​ ; f​Li​cang
speci​ ations​et and rules.), ​Fthe
al.​, 2016​ rankel (1989​,felt
pressures p. by
110) believes a
accountants to engage in unethical behavior are signi​fi​cant and l anchor, a meansasoftoday​
are growing public evaluation, aand
’s​ competitive source of strengthened
global
e the profession​
environments expand (​Onyebuchi, 2011​). While recognized professions have codes ’​s reputation
of ethics, thoseand public trust, for
codes (even a mechanism
a to
single profession such as accounting) differ in listed standards and t toacceptable
unethical conduct.
behavior,However,
a source culture
of support
(bothagainst
of an demands for
organization and of geography) may affect how individuals perceive djudicating
and act uponprofessional
the delineateddisputes.
canons.​De One
Georgeearly(2010​
study, pp. 342-343)
of internal auditors found that a ​“​single universal code of ethics ons:
may regulative;
not re​fl​ect protective
the needs of clients and the public
[an] international interest;
group​ ” speci​fi​c,
and non-self-serving. ​Raiborn and Payne (1990) ​assert that codes should be clear, Aspirational codes present ideal professional behaviors. Educati
le by reducing or eliminating ambiguity or doubt in the ethical decision-making provisions with extensive commentary and interpretation.​” ​Regulato
ze service to the client, while censuring inappropriate conduct by the professional a basis for adjudicating grievances.​” ​Thus, one intent of codes of e
late penalties for departures from the code: from reprimands to professional behaviors that, individually or collectively, would bring disgrace to
service, diminishing further trust in accountants​’ ​reputation. Our
aspirational,
Frankel (1989​, pp. 110-111) succinctly offers that there are three types of codes:educational and
aspirational, regulatory and
educational, structures for the accountant
regulatory.
The profession of accounting encompasses a diverse group of people performing innumerable activities in a wide array of
employment venues. However, the same reality exists for the medical and the legal professions, both of which have
comprehensive model rules of professional conduct to address certain basic duties that are owed to patients or clients.
Similarly, a model code of conduct can be developed for professional accountants, regardless of certi​fi​cation, licensure, or
location.
A model code would require an understanding of what professional duties are required and who the stakeholders of
accounting information previously addressed are. Further, such a code would also need to consider concepts such as
values and ethical frameworks. For example, ​Mintz (2016​, p. 8) suggests that the two most important values for
accountants are integrity and objectivity, ​“​two values that, along with independence, form the foundation for rules of
conduct. Voicing and acting on those values is essential to carrying out one​’​s professional responsibilities.​”
A model code of ethics for a profession should be grounded in the values that members of that profession deem to be
desirable. ​Adler (1999) ​de​fi​ned values as the amalgamation of the learning that occurs from childhood as a result of
interaction with family, friends, church and school. Values originate from one​’​s community and culture and aid in a
person​’​s determination of the important considerations in their decision-making processes. When values are added to
attitudes, beliefs and behavior, culture is formed, culture upon which a model code of ethics can be developed. Such a
code would include guidelines that are distilled from professional certi​fi​cation and licensure requirements to increase or
decrease the level of speci​fi​city to the individual or to the public interest.
Principles of the AICPA​’​s Code of Professional Conduct (2014) and the International Ethics Standards Board for Accountants
Code of Ethics for Professional Accountants (the
Applied ​Code, AESBA, 2016) were used to form the basis of a more generic code that we will shape into our proposed
code of profession ethics for accountants. Similarities between the codes are presented in ​Table II ​to re​fl​ect to fundamental
principles describing ideals of service for

code ​of ethics model

accounting professionals. Thus, the last column is a synthesis of the principles of the AICPA and AESBA standards,
re​fl​ective of broad societal ethical edicts as applicable to accountants. The descriptive words identifying the principles
from the identi​fi​ed codes are extremely similar, which would indicate at least some basic agreement on the fundamental
principles for the profession of accounting (see also, ​inter alia,​ professional practices developed by the Institute of Internal
Auditors and the Institute of Management Accountants). ​First, justice is a critical value. Professionals are expected to ​“​do

the right thing​” ​or perform

​ in a just and moral manner; justice entails the use of equity and fairness in decision- making.
Information will be sought and weighted appropriately, fairly. The value of utility refers to the usefulness of the
information supplied by the accountant to stakeholders. Regardless of the type of organization in which an accountant
works, the information he or she provides is relied upon by internal and external, known and unknown parties: in other
words, all stakeholders rely on such information. Utility mandates that information that will help ascertain the impact a
decision might have on stakeholders be provided; simply, the information the accountant provides must be meaningfully
useful. Without a continual focus on the generalized needs of what information will be useful to stakeholders, accountants
could generate information that could topple companies and invoke economic chaos.
Accountants must also be mindful of the maintenance of the skills that allowed entry into the profession. Thus, a
professional perspective must engender the creation of a life-long adherence to learning and competency. Integrity re​fl​ects
the dedication of a profession to the public. The public can place no trust or reliance in the information generated by
accountants without integrity. Integrity re​fl​ects a consistency of actions that re​fl​ect honesty, good faith, honor, sincerity
and candor in professional and interpersonal relationships. Finally, these four high-level epithets of justice, utility,
 competence and integrity portray qualities that are unassailable. We name our model after these values: the JUCI model; if
these values are followed, the accountant should be able to reason out and adopt a morally sound and defensible decision
to any dif​fi​cult moral question. Our position is that this model code of ethics is useful and ef​fi​cient, requiring review of a
minimum of fundamental canons that can
AICPA IESBA Synthesis
Responsibility Professional competence
Competence​: use of sensitive professionalism and due care
and moral judgment Do the right thing Public interest Professional behavior ​Utility​: serve the public interest
Respect of and responsibility to stakeholders Respect of and responsibility to the profession Integrity and honesty
Table II. ​Comparison and synthesis of the ​AICPA (2014) ​and IESBA (2006) Codal Principles ​Integrity Con​fi​dentiality
Integrity:​ be candid without breaching con​fi​dentiality Subrogate personal gain to public service Do the right thing Objective and independent
Objectivity ​Justice​: embrace impartiality and intellectual honesty
Refuse con​fl​icts of interest Respect of and responsibility to stakeholders Due Care Professional competence
and due care
Competence​: quality of Services Observe technical and ethical professional standards
excellence would the actor chose to adopt in any decision. The level
MRR with achievement, in this case, of the desired level of moral behav
ccountants and non-accountants alike. A serviceable model should help practicing the most dif​fi​cult level of morality sought to be achieved by any
al choices when they encounter ethical dilemmas (in contrast to other codes of represents ideal behavior or the spirit of morality. It is posited that
t are very good but astonishingly complicated, such as ​Hunt and Vitell, 2006​; reach because we are required to interact with counterparts that m
o be easily relatable to stakeholders who might be interested in knowing why an development. Such interaction with less morally laudable beha
way that he did. pragmatically, require our business morality to be adjusted to me
accommodation
This condensation of codal information supports the delineation of values is notofaccepted,
essential for codes ethics as the most highly
proposed desirable ethical
by ​Raiborn
and Payne (1990)​. Their model, derived from standards used in cost accounting, takes into consideration both levels of of the the
business associates also accept the goal of attainment
untenable
morality and ethical values deemed important to society. The values theyaspresent
evidenced by the sheer number
are commensurate andvalues
with the magnitude of all so
malfeasance
presented above, but they also base their model in levels of morality: of accounting​
the relevant fi​rms.is at what level of moral
question here
The practical level of morality re​fl​ects behavior that the majority of ​fi​rms could achieve through considered and careful effort
(​Raiborn and Payne, 1990​). The hallmark of the practical standard of ethical behavior is that the concept of morality is
deemed to be suf​fi​ciently important so as to be considered in decision-making processes. This level of morality is dif​fi​cult
to achieve, but is indeed, practically speaking, attainable by conscientious decision-makers. This level of morality is also
more closely attuned to adherence to the spirit of the law rather than merely the letter of the law. The third level, the
currently attainable level of morality represents adherence to standards of behavior considered to be our normal behavior:
it has ​“​the characteristic of being accepted by society, but not lauded as it really does not call for enormous amounts of
effort to ​‘​do right​’ ​(p. 884).​” ​In each level of moral behavior, the level of independently assessed and careful thought as to
the spirit of the law declines, ​fi​nally to the lowest level of moral behavior, the basic level. This level ​“​re​fl​ects minimally
acceptable behavior; the letter of the law (p. 885).​” ​It re​fl​ects behavior that society has judged, as re​fl​ected in legal edicts,
to be acceptable behavior: this behavior is legal, but it goes no further into searching for or adopting adherence to the
law​’​s spirit or the true meaning/intent of the regulation. This behavior is more closely associated with adherence only to
the letter of the law. Thus, the decision maker at this level of morality will only seek to ful​fi​ll legal requirements as
speci​fi​cally stated in the promulgated law, with no attempt to understand or obey the spirit of the law.
In assessing an ethical situation and related decision, an accounting professional could examine ​Table III​, which contains all
pertinent and important values as re​fl​ected in two actual codes of professional conduct and ascertain which values he will
be using. The

Applied code ​of ethics model

 Table III. ​The JUCI Model for accountant​’s​ ethical
decision-making
MRR
accountant can decide at what level of morality his decision should be made: some things are not to be compromised in
any way, while others may be reviewed at a lower level of importance. The model code can then be ​fi​ltered down to
individual accounting disciplines that can provide more detailed guidelines for actions. ​An example of the utilization of

this proposed model code might be aggressive tax avoidance.

​ While it is well-established that tax avoidance is eminently
reasonable, aggressive tax avoidance can be considered unethical (​Payne and Raiborn, 2015​; ​Raiborn ​et al.,​ 2015​). ​Table
IV ​represents possible approaches to tax avoidance or evasion. As can be seen from the practical application of the model
to the real instance of whether an accountant should engage in aggressive tax evasion, the top two levels of compliance are
very positive in nature: this is an indication that the code does in fact advocate for the adherence to the spirit of the law,
hopefully encouraging the accountant to choose the more appropriate response. ​A model code does not preclude the desire
 for other, more focused, codes of ethics or professional
​ conduct for accountants. However, there are several reasons why a
model code, transferable across accounting, business and societal behaviors, is a valuable resource for accounting
professionals. First, the model code​’​s values are applicable to the whole populace of professional accountants rather than
stylized codes that address only accountants who are in ​“​this​” ​or ​“​that​” ​discipline area, hold ​“​this​” ​or ​“​that​” ​certi​fi​cation, or
are licensed in ​“​this​” ​or ​“​that​” ​state or country. Second, the model code is drafted in ​“​plain English,​” ​making it clearly
understandable by accountants and non-accountants. Third, though not
Table IV. ​Application of the JUCI Model Code of Professional Ethics: Tax Avoidance
Levels of ethics Theoretical Tax
Overpayment
Practically Attainable Tax Avoidance
Current Aggressive Values tax avoidance Basic Tax Evasion Justice Failure of
fairness to the client
Payment of taxpayer​’​s fair share
Payment of taxpayer​’​s potentially too little share
Non-payment of taxes
Utility Harmful to
shareholders
Bene​fi​t to stakeholders, including shareholders who are assured that their ​fi​rm is a full participant in the creation of value for themselves and
society
Bene​fi​t only to shareholders; other stakeholders are harmed: government provision of public goods and services is endangered
Bene​fi​t only to shareholders and only if the evasion goes undetected (potentially very short-term bene​fi​t with potentially long- term and serious
legal consequences)
Competence Failure of
accountant to protect his client to the legal and ethical limit
Correct maintenance of legal and ethical accounting standards
Questionable manipulation of legality
Illegal and unethical manipulation of accounting standards
Integrity Failure of
accountant to discharge his ​fi​duciary duties to his clients
Good faith assessment of what is owed
Possibly bad faith assessment of what is owed
Bad faith assessment of what is owed
Source: ​Payne and Raiborn (2015)​, ​Raiborn ​et al. ​(2015)
he need for the accounting profession to retrieve its brand by more effectively em
the focus of this effort, the JUCI model is well grounded in ethical principles
ntegrity, itwell-established as providing
is increasingly important thatethical
accountants should become familiar/mo
guidance (​Kant, 1964​; ​Aristotle, 1984​). guidelines, and that those guidelines should be rules truly to live by in everyday ap
To provide more far-reaching guidance on how to act, this paper p
rofessional accountants.
Conclusion ​Signi​fi​cant criticism has been directed at internal and external accountants for theirThe JUCI model
professional code ’looks beyond an accountan
colleagues​
roles (or perceived roles) in some of the recent business failures. Inworkplace;
some cases,it thelooks beyondiscerti​
criticism fi​cation,
valid; licensure
in others, it is or locale. The model code is un
or whom it has been developed but
possible that the criticism stems from a lack of understanding about what accountants do and how they do it. Accountants also for the stakeholders to whom the accoun
heir information. The JUCI model
are part of the human resource contingent referred to as knowledge workers whose professional abilities re​fl​ect mental provides clear, prescriptive guidance for a
acuity and problem solving. harged with protecting the public interest. Like all professional codes of ethics
Accountants produce information (be it is the form of monetary analyses, ​fi​nancial statements, tax returns, or of professional charac
hat, if consistently acted upon, form the foundation
ccounting professionals are enhanced by ethical leadership and values-based de
audit opinions) that is used for dissimilar purposes by a multitude of stakeholders. Because of the critical impact that
accountants​’ ​work can have on economic decisions, accountants (in a manner
cting on one​similar to physicians)
’​s beliefs in a mannermust embracewith
consistent the public interest obligation
concept of non-malfeasance or the ethical principle of doing no harm. It is essential that members of this profession be
ethical and stand fast against the internal and external pressures that might
ncludes theencourage
testing of these professionals
the model empirically; to engage in of this effort has been
the focus ​ to
fraudulent activities. Codes of ethics focus on ​“​how​” ​professionals,esting.
including
Uponaccountants,
completion perform
of initialtheir testing,
functions.
the model Suchcan be further re​fi​ned based
codes provide guidance on right and wrong. Such codes can also serve onsideras deterrents
using the to Delphi
the rationalization
method of analysis dimension to further
of ascertain the validity
the fraud triangle. valuators. Additionally, we would like to present this for review by current acco
Onyebuchi (2011​; p. 276) asserts that ​“​(a)ccounting codes gain of
even more insight
professional into the
conduct ef​fi​fci​cacy
signi​ of in​
antly this model.
fl​uence the
behavior and judgment of practicing accountants.​” ​Coupled with the fact that ethical issues are pervasively present and
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Corresponding author ​Matthew Zingoni can be contacted at: ​mzingoni@uno.edu

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