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The Importance of Ethical Accounting

The Importance of Ethical Accounting

“Ethics is knowing the difference between what you have a right to do and what is right to do.”- Potter Stewart

Ethics is an integral part of an individual that defines his/her professional ethics. And accounting is one such profession that affects the lives of millions of people each day which makes ethical accounting practices even more important. An accountant’s one mistake (be it intentional or unintentional) can wreak havoc in people’s life. 

Enron scandal of 2001 is one such example that is cited as the biggest audit failure and left the Accounting profession questionable. 

Therefore, ethical accounting practices are very important as businesses are counting on them to be fair and also it influences the lives of ordinary people to a great extent. Here’s what Ethical Accounting incorporates:

You May Also Read – Why you need a Virtual Accountant for your Business in Year 2020?

Ethical Accounting and How to Practice it:

We are living in a globalized marketplace where Accounting services can be carried out from all around the world. Fair and transparent accounting practices define the honesty and integrity of an Accountant and make sure that they are positively affecting the lives of others. Here are a few reasons to practice Accounting:

  1. Accounting deals with sensitive financial information 
  2. Accounting mistakes can affect many and can prove to be very costly
  3. Ethical Accounting ensures healthy and long-term business relationships with your clients
  4. It allows you to build a reputation and grow your professional network 
  5. Practising Ethical Accounting will help you avoid any legal repercussions 

Here the 5 common Ethical Accounting codes

Integrity

There have been examples in the past where the Accounting profession can be driven by illicit gains, however, integrity towards the profession is a must to keep the profession ethical. Accounting firms and accountants should feel morally obliged to keep their reporting accurate and transparent.

Confidentiality

Practising confidentiality restricts Accounting firms to share sensitive information with third-parties including unauthorized personnel of the organization. Sharing information either intentionally or unintentionally is against the ethical accounting code. However, if any information that goes against the public interest should be shared after seeking a professional lawyer’s help.

Also Read – 5 Bookkeeping Issues That are Solved By Outsourcing it to Experts

Independence and objectivity

Objectivity is an ethical code that concerns an individual accountant’s whereas Independence is an Accounting attribute. Objectivity is an accountant’s mental state to be unbiased in his/her judgment and shouldn’t be driven by personal gains or someone else’s influence. Independence is what defines the objectivity of the Accounting profession as a whole.

Competence

Accounting firms and accountants should be well-aware of the latest technology trends while they adopt the best industry practices by continuously upskilling. Accounting professionals should be trained well to keep up with the industry norms and carry out their responsibilities while following the ethical code of competence.

Professional Behaviour:

No profession is ever complete without the commitment to practice professional behavior while respecting the profession and complying up with the laws and regulations of their profession. Accounting Services need to ensure that they don’t negatively impact the profession.

Wrapping Up:

Accounting profession is a sophisticated profession where mistakes can be costly. Also, professionals might get distracted to move up the ladder quickly by practicing illegal means, however, following ethical accounting is always the right way to be successful in the long-run while you don’t put your reputation at stake.

Why you need a Virtual Accountant for your Business in Year 2020?

Why you need a Virtual Accountant for your Business in Year 2020?

No one ever said that running a business would be easy. In fact, it is one thing to run a business, and it is a different thing to be able to keep up with the changing times and by responding to it with scaling up and evolving your business. A business is only as good as the efficiency it is run with. The time you put in it, the resources you foster it with and the team that is behind making it a success. 

A profitable business is always the one that has impeccable logistics and operations. Because when you are able to micro-manage your business well, then you are able to take care of the larger picture of making profits and expanding operations. 

When talking about bringing efficiency in logistics, what comes on top of the list is accountancy and bookkeeping operations. When your business is small, it is easier to manage its finances. But as it starts to grow, you are caught up in handling the sales, marketing, expansions and slowly the financial management starts being a hassle and ends up being ignored. 

This is where virtual accounting comes in the picture. Their team of expert professionals help take off the load of your operations and prioritise your tasks. 

How Virtual Accountant Helps Your Business?

 

Virtual Accountant is the game-changer when it comes to streamlining and organizing your business logistics better. Here are some of the benefits that your business can avail by choosing virtual accounting services:

  • Get Your Financial Reports When You Need Them:

The most important part of knowing where your business is situated at present and where it is headed to in the future are through financial documents. It is important to have updated, accurate and consistent documents. A virtual accounting firm, will help you in formulating updated financial documents to help you take care of the daily operations of your business and to run it efficiently at the tip of your fingers.

Also Read – Management Accounts for a vendor operating several stores

 

  • You Will Not Need to Hire and Train a Team:

When you have a team of dedicated and expert virtual accountants, then you no more have to find a team of qualified accountants, or train them. Because, virtual bookkeepers only hire the best in the business. Adept with all the highest certifications and qualifications. This helps you save time on finding the personnel that will fit the bill for your business. 

 

  • Get Balanced and Updated Books Everytime:

You will no more have to face the wrath of the year-end stress, as your team of virtual accountants will make sure that you have accurate, updated and error-free books throughout the year. Your records will be reconciled and available in an understandable fashion at all times. 

 

  • Help Your Business Get Better Work Management:

When you have time savings from not having to handle accounting tasks for your business, you will be able to delegate that for the betterment of the management and expansion of your operations. You will be able to take care of your business and run it efficiently.

 

  • Save Upto 50% Off Your Annual Accounting Budget:

With virtual accounting you will be able to save on the overhead charges of having an in-house accountant. Your cumulative savings on salaries, tax benefits, rentals and the added opportunity costs will help catapult other areas of your business. As with virtual accounting you only pay for the services that you avail for. 

 

  • Gain Convenience and Flexibility:

The convenience of having a team of expert professionals available to your business around the clock will give you added flexibility. Because a growing business is dynamic and its needs can arise at any time, therefore, having a virtual accounting service will help you with your financial needs 24×7. Also, they grow as you grow and help in scaling up their services as you scale up. 

Wrapping Up

Virtual accounting services is a one-way ticket to increased profit and for added peace of mind. With the evolution of how businesses are done, virtual accounting is the way to an organized future for your business. No matter the size and stage of your organization, virtual accounting will help you ace every sphere of your business’ logistics and operations.

We hope that through this blog, you will be able to find one of the many ways in which virtual accounting can help benefit your business. Get on with financial trend of the future, opt for virtual accounting services.