Professional Ethics: The Moral Courage of Internal Auditor

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Concept of Professional Ethics

The Australian Council of Professions (2003) defines a Profession as a disciplined group of individuals who adhere to ethical standards and who hold themselves out as, and are accepted by the public as possessing special knowledge and skills in a widely recognized body of learning derived from research, education, and training at a high level, and who are willing to apply this knowledge and exercise these skills for the benefit of others. This demonstrates that a profession is a commitment to a specified and organized occupation based on authority over a body of information and the acquisition of specialized training.

A professional is a practitioner who belongs to a certain profession and is able to make judgments, apply their abilities, and reach educated conclusions in situations where the general public cannot because they lack the necessary knowledge. Professionals are controlled by codes of ethics and profess dedication to competence, honesty and morality, altruism, and the advancement of the public good within their respective fields of expertise. Professionals owe a duty to their clients and to the society Evetts (2011).

Professionalism is defined as the views a Professional hold about his or her own behaviour as a member of a Profession. It is frequently associated with the observance of the principles, laws, ethics, and norms of a Profession in the form of a code of conduct.

Professionalization is both the pattern of a profession’s evolution and the act of becoming a profession (Abbott, 1988). A set of moral principles or beliefs constitutes ethics. A system or code of behavior is based on moral duties and obligations that outlines how an individual should conduct themselves in society. Professional ethics are the standards of personal and business conduct, values, and guiding principles that are required of professionals.

Moral Courage

Moral courage bridges the chasm between making a decision among alternatives and also acting on decisions previously made. Courage, according to the Greek philosopher Aristotle, is the Golden Mean between cowardice and recklessness, the exact location of which varies based on the circumstances. To discover the golden medium requires guts in every aspect of life (Ehiriudu, Ugwuozor, Igweonyia & Ani, 2021). According to Sanchez and Cabello (2013), courage is prosocial behavior such as speaking and acting on one’s findings and beliefs. In addition, they emphasized that moral courage is moral competency that tends to overcome the fear of doing the right thing among auditing professionals.

Auditors, both internal and external, must understand how to exercise moral bravery. To auditing professionals, moral courage entailed balancing logical ethical principles against unthinking selfish benefits and routinely breaching ethical standards by surrendering to or acting on self-serving temptation (Kolodinsky 2012). This meant that an auditor should not bow to situational pressure when dealing or fulfilling their professional tasks, but rather be decorated with high moral intensity and the bravery to stick to the ethics of the profession.

Marylin Douglas (2014) emphasized that courage is a multidimensional term with health, physical, and moral elements. Moral courage stands out the most among all the dimensions.

Moral courage was described by Lopez (2003) as the ability to transform moral intentions into acts despite demands from the organization to do otherwise. When challenged with adverse repercussions and social criticism or enchantments, moral bravery enables auditors, groups, corporations, and organizations to stand up for their views and ideals for the greater good.

When confronted with temptations and professional challenges in the job, moral bravery is the auditor’s capacity to remain steadfast and unyielding.

The auditor employs moral fortitude and ethical principles to escape the issue presented in the profession. Moral courage and moral imagination develop empathy, which has an effect on auditors. Moral courage entails doing the right things and insisting on facing the blames and rebukes that may result from doing the right thing in accordance with ethical standards (Lopez 2003).

They argued that moral courage transforms moral thoughts into deeds without regard for pressure, retaliation, or the

Internal auditors are expected to conduct their duties with due care, accountability, and consistency. Karssing (2011). The goal of The Institute’s Code of Ethics is to establish an ethical culture within the profession of internal auditing by outlining the rules and standards governing the behavior of individuals and organizations when conducting internal audits. Rather than particular tasks, it describes the baseline requirements for conduct and behavioral expectations.

Ethical behavior involves adherence to unwritten norms and a culture of “doing the right thing.” A range of elements, including industry and business rules, social and economic constraints, laws and regulations, and prevalent attitudes and beliefs, influence an individual’s view of ethical action. These factors shape a set of written and unwritten ethical rules that are utilized when confronted with an ethical dilemma. For the accounting profession to gain public trust, ethical conduct is important.

Given the call for increased ethical behavior among

The nature of auditing establishes a unique position of trust with respect to customers, employers, employees, and the general public, who rely on the professional judgment and recommendations of auditors to make informed decisions. Due to the fact that accountants and auditors provide information about companies that enables the public to make investment decisions, there is a widespread impression that individuals in the accounting profession have a significant responsibility to the public. For the public to depend on the presented information, there must be confidence in the accountants’ and/or auditors’ knowledge and conduct. According to Jensen (2006), the auditing profession should serve a crucial role of societal trust by serving as a vehicle for holding managers accountable for their conduct. This process should ensure that the financial data provided by management is accurate and comprehensive.

However, the recent pace of corporate failures and accounting scandals has affected investor faith in the corporations’ and capital markets’ openness, honesty, and accountability. Auditing is a public service that verifies the statements of financial management and reassuring investors. Therefore, as professionals in

condemnation of like-minded individuals who profit from illegalities and infractions.

Significances of Moral Courage

The importance of moral courage in the auditing profession is as follows: First, moral bravery enables internal auditors to advocate fearlessly for their rights in the workplace. Hannah (2011) theorized that moral bravery enables auditors to act meaningfully on their intentions by reviewing and analyzing every topic seriously and correctly in a morally courageous manner prior to rendering a sound verdict on it.

violent or spiteful behavior? The answers to these questions constitute our “moral compass” in a broad sense. Gino (2016) described a moral compass as the aggregate word for an individual’s views, goals, and judgments around what is right and wrong. A moral compass consists of the internal principles that drive ethical behavior and decision-making, similar to a navigational compass. Gino (2016) stated that the vague character of morality, which can change and evolve over time and depending on subjective experience, makes it difficult to argue for a universal moral compass or moral absolutes.

It is a circumstance in which a person must choose an appropriate course of action. In moral philosophy, ethical dilemmas are frequently invoked in an effort to refute an ethical system or moral code, or to enhance it in order to resolve the paradox.

In the exercise of professional judgment, auditors are regularly confronted with complicated, unforeseen moral challenges that cannot be resolved through the application of a code of conduct (Gaa, 1992). The auditors’ professional conduct has been crucial in boosting the confidence of financial statement users and confirming the financial statements’ integrity (Karajeh, 2004).

Accounting was originally regarded by the public as having the highest level of integrity among other occupations (Pearson, 1988). However, after a series of high-profile scandals, this profession’s reputation has declined (Herron and Gilbertson, 2004).

Internal Auditors have a fiduciary duty to the audit client and the employer. In such a connection, they are responsible for ensuring that their obligations are carried out in accordance with the ethical standards of honesty, integrity, objectivity, reasonable care, confidentiality and putting the public interest ahead of their own.

The accounting and auditing profession is confronted with a range of types and degrees of ethical difficulties. The following are examples of the most prevalent ethical challenges in the corporate environment: Dealing with pressure to act unethically, especially from dominant superiors; Striking a balance between confidentiality and blowing the whistle on illegal or improper actions of others; Disclosing information in the public interest; and Wrongful trading in a distressed situation where insolvency is possible.

According to Okezie (2016), ethical dilemmas encompass a variety of ethical issues, including overstating performance and valuation, engaging in fraudulent activity, non-disclosure and withholding of information from auditors and other stakeholders, and making a decision without sufficient information. Other prevalent dangers to the accounting/auditing profession include:

iv. Advocacy Threat – where the auditor finds himself in a position he has to defend or promote the interest of its client before a third party.

v. Self-review Threat – when the auditor has to audit the work that he helps to carry out.

vi. Opinion Shopping – pressure on auditors to accept questionable accounting treatment.


  Second, moral courage enables auditors to go the extra mile to instill sound morals in the course of doing their professional obligations, regardless of whose ox gets gored. This practice carefully adheres to professional norms of behavior. Thirdly, moral courage as a competence equips auditors to engage in activities that do not compromise the integrity of the auditing profession.

Moral Compass

Undoubtedly, life can be tough, and navigating the tricky waters of interpersonal relationships and sophisticated decision-making may be challenging. Every day, we make “good” or “poor” decisions that determine our conduct. When shopping at the store, it would be simple to conceal a bottle of expensive spices to save N500; yet most individuals prefer not to do so; why? What prevents us from flirting or texting someone new if we are in a committed relationship? What about deceiving our spouses, subordinates, and children? When our emotions, whether rage, envy, or love, overpower us, what prevents us from engaging in

Moral Burden of the Internal Auditor

Ideally, auditors conduct their duties with due care, accountability, and consistency. Internal auditors face moral difficulties including competing ideals, codes of conduct, and interests, as do all other professionals. According to well-known key phrases: Should auditors examine, learn, or instruct? Should they frustrate or offer suggestions? Control or report? How forcefully should they convey their opinion when a solution is imminent? How critical should they be of their team of directors’ policies and their colleagues’ work? These general inquiries encompass a greater number of concrete challenges and conundrums with which internal auditors frequently contend. Wirtz and Karssing (2015).


An ethical dilemma is a complicated scenario that frequently contains an apparent mental conflict between moral imperatives, wherein adhering to one




Familiarity Threat – auditor becoming unduly sympathetic towards its client as a result of long association.

Intimidation- auditor comes under intimidation by dominant individual or aggressive atmosphere at the clients.

Self Interest Threat – when personal interest of the auditor conflicts with that of the client

Auditors can be satisfied when they exemplified the culture of moral courage by embracing ethical behaviour that encourages morally courageous action in their workplace. Sekerka (2009) agreed that moral courage is an attribute that enhances good morals, sound judgements, justices, integrity, boldness in the face of difficulties. Ethical behaviour, moral virtues, and professional competency help moral courage to strive. White (1998) admonishes that durable moral courage should be seen among auditors, which is the capacity to insist on demonstrating genuinely and committed morally courageous behaviour.

Internal Auditors may encounter difficulties like; rejections in their workplace, condemnation for resistance to succumb to internal and external pressure, retaliation, and reprisal attacks by their colleagues, within and outside the organisation. Not minding the circumstances that surround the auditing profession, internal auditors should look at the ethics of the profession as a moral compass directing their activities in the profession. Auditors should insist on the moral value, ethical standards, and professional codes of conducts that boosts moral courage in them, which help them to carry out their work without fear or favour. Finally, moral courage among auditing professionals should be strengthened in all ramifications because it is a virtue and not vice and it is needed among the auditors.

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