[IS THE OPERATION OF AUDITS NECESSARY?]
[We need to understand that audit is about achieving customer satisfaction in order to gain repeat business and overall increase company revenue.]
What is business ethics? The ethics of a particular business can be diverse. Business ethics is the behavior that a business devotes to in its daily dealings with the world. Auditing is the analysis and inspection of the financial accounts/records whether or not a company has a qualified accountant and procedures of a firm or organization. This is necessary to gain a fair information on the company’s financial statements. With its auditing, potential investors and creditors can look at the financial statements to decide whether to invest in a business or not. Moreover, auditing is important as it also protects the public from scams and corrupt business procedures. So, is an audit process required? Yes, I believe it is an essential part for every business’s ethics, which is literally in order to do the right thing and guide how they should behave regarded as moral values.
Many businesses have gotten a bad reputation by behaving unethically in order to survive in this competitive age. Some people may argue that most businesses are just interested in making money, which could be viewed as capitalism. It is not wrong to earn money in itself. This is the reason and the manner all companies exist. And, some companies actually are not aware of the importance of its auditing. They just think that it’s a waste of money and time. This aspect is the major drawback in these companies as customer doesn’t depend on these companies for long and their business is affected in long terms. They need to understand that an audit is about achieving customer satisfaction in order to gain repeat business and overall increase company revenue.
In a Harvard Business Review article by Lynn Paine (1994), the conception of “managing for organizational integrity” has become an appealing concept to the corporate world. Managing for honor is far more than compliance, it also includes management self governance in which company’s employee ethics play a major role. The key aspect for employment is education, leadership, and accountability. These are the compliance strategies that are usually based upon externally established standards. In the corporate world, the key word “stakeholder” is considered a questionable term. The word stakeholder is used to describe stockholder and investors who are involved in accusation made by the firm. Stakeholder theory has become well known theme in the business/ethics and society literature. This term has developed more meaning not just in the business world but also in political implication because of the Labor Party in Great Britain, who has adopted this theory. To many economists the word “stakeholder” is known as the internal code which is used by many companies managers to justify their breaching of fiduciary duty to the owners of the companies....