Corporate activities in 2017 were in many ways different from those of 1997. There were approximately 46,000 multinational corporations (MNCs) in 1997, 80,000 in 2011, and 90,000 in 2014. In 1994, MNCs were estimated to employ some 53 million persons at home and in host countries; in 2017, 70 firms alone employ 76 million people worldwide. Multinational companies are all around us whether we realize it or not. Writing in Forbes in May 2016, Steve Schaefer notes, “public companies from 63 countries that together account for $35 trillion in revenue, $2.4 trillion in profit, $162 trillion of assets, and have a combined market value of $44 trillion.” Therefore, I agree with Richard Kravitz that “given the increasing power of corporations today, I would argue that financial managers, outside advisors, and auditors (internal and external) have an even more critical fiduciary responsibility than ever before. We have an inviolate steward-ship obligation to serve the public interest” (Response to “Independent Auditors Are Not Fiduciaries,” June 2017, http://bit.ly/2uJWYYF).
It is of further importance that the AICPA has established accountancy as a profession distinguished by rigorous educational requirements, high professional standards, a strict code of professional ethics, a licensing status, and a commitment to serving the public interest. The AICPA requires all professional accountants to act responsibly when engaging in accounting services and reviewing sensitive financial information. The AICPA believes that all accountants should exercise sound moral/ethical judgment in all of their accounting activities and practices. They must provide truthful and accurate assessments of the clients’ financial health to the general public and those who have a vested interest in public companies. This is their fiduciary duty!
While every company has different sets of guiding principles, most can agree that they want to serve their clients or customers, be the best that they can be within their business segment, grow their business, and provide value for their shareholders and stockholders. How they achieve the desired results is what sets these companies apart. Some will hold true to their ethical and moral compass, while others will do whatever it takes to achieve the desired outcome. How do we ensure that all companies act in a moral and ethical manner? Are professional accountants acting responsibly when engaging in accounting services and reviewing sensitive financial information?
Kravitz has written some of the best editorial/articles I have read this year. Thank you so much for sharing.
