5 Basic Principles of Accountant Ethics Violated by PT Asuransi Jiwasraya

b. Dishonesty in Disclosure of Information

The principle of integrity requires accountants to disclose information honestly, especially information that can influence the economic decisions of users of financial statements. 

In the Jiwasraya case, there are indications that the company failed to disclose important information related to its risky investments, especially in stock mutual funds with highly fluctuating values. Rather than being transparent about the potential for large losses from these investments, management and accountants chose to hide the facts.

c. Presentation of Misleading Information

Integrity is also related to providing information that is not misleading. In the Jiwasraya case, the company allegedly presented figures that did not correspond to the actual conditions, such as exaggerating the value of assets and delaying the recognition of losses. As a result, the company's financial statements provided a misleading picture to the public and shareholders.

d. Accountants Involved in Scandals

Accountants involved in the preparation of Jiwasraya's financial statements have a great responsibility to uphold the integrity of their profession. However, in this scandal, they appear to have violated that responsibility by following management's instructions to manipulate the financial statements. 

The principle of integrity should prevent accountants from engaging in unethical or illegal actions. Accountants with integrity will refuse to engage in legal and ethical violations, even when under pressure from management or shareholders.

2. Objectivity

The principle of objectivity is a fundamental principle in the accounting profession, requiring accountants to be free from bias, conflict of interest, and external influences that may affect their professional judgment. Objectivity ensures that accountants maintain independence, fairness, and impartiality in presenting financial statements and providing accurate and reliable information to the public. However, in the PT Asuransi Jiwasraya financial scandal, this principle was significantly violated by the accountants and management involved.

a. The Influence of Management on Accountants