Can you recall the last time you witnessed or found yourself in the middle of an ethical dilemma at work?
If you can, you’re certainly not alone.
“There are so many situations that have an ethical dimension,” says Jonathan Andrews CPA, CA, course developer of The Ethical Dilemma, a popular course offered by CPA Alberta which is based on real events involving professional misconduct.
During his 50-year career, Jonathan has specialized in providing technology assurance services for public accounting firms, and over the past two decades he has also been developing training courses for clients and CPAs. He developed The Ethical Dilemma specifically for CPA Alberta after reviewing several disciplinary procedures. As a result of the review, he created a series of fact-based case studies to illustrate the importance of maintaining an objective, ethical lens.
“There are so many situations that have an ethical dimension…As the future unfolds, the need for an objective, ethical lens will become that much greater.”
Jonathan Andrews CPA, CA
“As the future unfolds, the need for an objective, ethical lens will become that much greater,” says Jonathan. “It has to be your conscious, objective self that provides a response, not an automatic, knee-jerk, self-serving reaction.”
Conscious or unconscious responses: Real example
Through the case studies presented in the course, it’s apparent that in many instances, individuals responded inappropriately to ethical challenges, either consciously or unconsciously.
“Their responses were a result of established patterns of behavior. The good news is these patterns can be changed,” says Jonathan, explaining that increasing ethical awareness is one way to do so.
While many of the case studies involve various forms of professional misconduct, such as fraud and plagiarism, the example that stands out most for Jonathan is not as dramatic as one might imagine.
In this example, a CPA has long-term clients, a husband and wife. Over time, the CPA and the clients become friends. However, when the husband-and-wife divorce, the CPA, although dismayed, decides to continue their relationship with both, without formally acknowledging the change in circumstances.
Although the situation is understandable, it goes against the CPA Alberta Rules of Professional Conduct (RoPC), Jonathan explains. In this type of situation, the CPA is required to either withdraw from providing professional services altogether or re-continue with the engagement if the informed consent of both the husband and wife is obtained first and the conflict management techniques detailed in the RoPC are applied.
“Had the CPA in this example been aware of this and acted accordingly, there would have been no need for disciplinary hearings.”
Regardless of whether the ethical lapse was conscious or unconscious, CPAs are expected to know the rules and regulations and always demonstrate an ethical mindset.
The CPA’s ethical mindset
As part of the Chartered Professional Accountants Act, every Alberta CPA has a responsibility to their clients, organizations, and the public. The public places their trust in CPAs and expect them to know and follow the rules and regulations that govern the profession.
The CPA’s ethical mindset, as defined in the RoPC, is based on five principles: professional behaviour, professional competence, integrity and due care, objectivity, and confidentiality. The “ethical compass”, as defined in the CPA Canada publication The CPA Way, provides direction for managing new situations.
Jonathan advises that a thorough grounding or refresh in professional ethics will help professionals have a satisfying and rewarding career as ethical CPAs. He believes that the CPA ethical mindset will become even more vital than it is now, especially for avoiding ethical lapses related to the pervasive use of technology, especially artificial intelligence. With the growing importance of this competency, CPA bodies across Canada integrated an ethics component into the Continuing Professional Development (CPD) requirements in 2019.
New Professional Ethics Requirement
In 2019, a professional ethics requirement was implemented across the CPA profession. This means throughout the three-year Continuing Professional Development (CPD) rolling cycle, CPAs will need to participate in a minimum of four hours of verifiable learning activities in the area of professional ethics.
Avoiding ethical lapses
In today’s work environments, there are many situations in which a CPA may encounter ethical issues. Although situations may be distinct and complex, there are two general considerations to keep in mind.
Recognize the ethical dilemma
“Stay alert, objective, and skeptical.”
CPAs are expected to have a high level of ethical awareness to recognize ethical issues and concerns. This awareness helps an individual prevent ethical lapses, avoid succumbing to the temptation to dismiss warning signals, and stop rationalization of unethical behaviour. Jonathan advises CPAs to remain ethically aware—especially by keeping current on the rules and regulations concerning the CPA’s current sphere of activity—in order to respond appropriately when needed.
“There will be many pressures to ignore the warning signals,” says Jonathan. “We describe these pressures in detail in the course.” To combat those pressures, he recommends CPAs “stay alert, objective, and skeptical.”
Respond to the ethical dilemma
When an individual CPA is facing an ethical dilemma, tension can increase. However, according to Jonathan, it can be reassuring to know that an ethical dilemma represents a healthy situation. It is the response to those warning signals that are causing the tension that now matters. The nature of the response will define the strength of the CPA’s ethical character.
“All CPAs and professionals need to avoid the temptation to respond quickly, for example, in an attempt to impress others,” Jonathan explains. To illustrate, he quotes the neurologist, Viktor Frankl: “Between stimulus and response there is a space. In that space is our power to choose our response. In our response lies our growth and our freedom.”
There are four general steps to keep in mind that can be useful for determining the most appropriate response to an ethical dilemma.
Document the details
One of the first steps should be to document the details of the situation. This can help clarify the ethical concerns before going any further.
The process of documenting should involve referring to the ethical conflict resolution steps in the RoPC, if one or more of the five ethical principles are involved. To gain some ethical direction, the ethical roadmap and self-evaluation checklist in The CPA Way document can be valuable.
Follow the prescribed procedures of the organization
The next step is typically to speak to someone with the appropriate responsibility within the organization, to understand the prescribed procedures laid out by the organization. If that is not possible or comfortable, external resources can be considered.
Consider external resources or legal advice if needed
If a CPA decides to seek external help, an appropriate next step may be to contact CPA Alberta’s Advisory and Consultation Services. These services are provided to CPAs, students, and the public on a broad range of topics such as conflict of interest, and provide only informal feedback. The service is free and confidential.
Consideration may also be given to speak to a lawyer in confidence. It’s important for the CPA not to feel alone in the situation.
Take care of mental health
Ethical dilemmas can cause distress for individuals. Taking care of mental health, especially during challenging times, is vital. CPA Assist provides confidential counselling services and 24/7 crisis support to CPAs, candidates, and their immediate families.
Helping organizations see ethical problems
An ethical dilemma can weigh heavily and easily be perceived as an individual CPA’s problem.
Jonathan advises that an ethical dilemma is not, almost by definition, an individual’s problem. Rather, it can be understood and framed as an organizational problem, which the CPA is doing their best to help the organization address.
“I know what it’s like to be in an ethical dilemma and having to make a difficult choice—a lot of strength can be drawn from the knowledge that you are doing the right thing.”
Want to enhance your knowledge on professional ethics?
CPA Alberta offers a variety of professional development opportunities, at different price points and formats, to help you stay competent and confident.
Ethical Leadership in an Age of AI – Live Seminar | $205 | Dec. 21, 2021 | 12:30-4:30 pm MST
The Ethical Dilemma – On-Demand | $219 | 4.5 hours
- “I found the course insightful and very useful, and above that, easy to manage at a time that was most convenient for me to learn at my best.” – Past Participant
Technoethics – On-Demand | $79.00 | 2 hours
Ethical Decision Making in a Crisis – On-Demand | $59.00 | 1 hour
Browse through more courses on ethics and related topics here.
