Professional Versus Persona judgement in accounting world Essay

Professional Versus Persona judgement in accounting world - Essay Example Personal judgment emanates from an individual based on personal views, values, and opinions. On the other hand, professional judgment emanates from a set of guidelines stipulated by relevant bodies in the respective profession. In the accounting world, the main accounting bodies that govern professional judgment are; The International Accounting Standards Board (IASB) and The International Federation of Accountants (IFAs). Personal judgment may be biased due to subjective reasoning from the accountant. Cottone, (2001) states â€Å"accountants need to move from psychologically based ethical decision-making models to socially constructed decision-making models.† Ethical issues that arise in accounting ought to be handled in objective reasoning (professional judgment) as opposed to empathetic and irrational reasoning (personal judgment). There are numerous users of financial information (managers, investors, lenders, employees, and shareholders). It is prudent that accountants apply the accounting guidelines in line with the Code of Professional Conduct stipulated by AICPA to put the interests of all users of financial information into consideration. In a situation whereby an accountant applies personal judgment to solve an ethical concern, he or she may end up favoring one party. Such acts may be considered discriminatory and may lead to legal action being taken against such accountants. All acco untants should bear in mind that â€Å"professional judgment results in wisdom from experiences being applied in ethical decision-making processes† (Lehr and Sumarah