Letters

Ethics Education for Students
I read with much interest “Accounting Education: Response to Corporate Scandals” (JofA, Nov.04, page 59). Having students discuss the ethical implications surrounding business decisions is an excellent addition to the curriculum. I had a course in my undergraduate program in the early 1990s that dealt with business ethics. It was interesting because it made us think about the issues surrounding the decisions being made in terms other than dollars and cents.

However, I would like to voice a word of caution about the rush to add ethics to the curriculum that’s mentioned in the article. It is nave to think that an ethics assignment, or even a semester-long course, will make students more ethical. By the time most accounting students enter an accounting class, they are already 19 or 20 years old. Do we really think a classroom discussion on ethics is going to undo 20 years’ worth of other influences?

Collegiate ethics training is a good start, but we cannot depend upon it alone to make students ethical. It is the responsibility of those of us currently working in the field of accounting to exhibit ethical behavior in our daily dealings and to demand it from our staff members. Without the reinforcement of ethical behavior in the work environment, the positive effects of collegiate ethics training will be extinguished. While I do applaud the efforts of schools, ethics classes alone cannot provide the “silver bullet” that will prevent the next Enron.

R. Scott Stultz, CPA, Controller
Tri-State Transit Authority
Huntington, West Virginia

“Accounting Education: Response to Corporate Scandals” talks about a world that does not exist and is not likely to be a reality anytime soon. Significant changes must be made in Sarbanes-Oxley and other laws to protect the persons raising the questions. It is one thing to detect and understand fraud. It is a completely different matter when one is challenged to step forth and do something about it. Students need to be educated to the risk inherent in doing the right thing. When raising the questions and provoking the necessary discussions, the person operating on his or her moral compass will likely be chastised for not being a team player rather than applauded for raising the ethical bar. Until the ethical person is provided more substantive protection in the workplace, ethical behavior will continue to be more of a goal than a reality.

Mary Lou Herring, CPA
Topeka, Kansas

Medicaid Debate Continues
The author of the letter, “Rethinking Annuities for Medicaid Eligibility” (JofA, Nov.04, page 13) found the article, “Private Annuities Can Aid Medicaid Eligibility” (JofA, Jul.04, page 88) offensive and said that “encouraging people to game the system is unethical and should be discouraged by your magazine, not promoted.” He added, “Mississippi is struggling to fund its Medicaid program to help truly needy citizens.”

Funding struggle! The Mississippi state legislature elected to place in a rainy day fund its substantial share of the billions of dollars in tobacco settlement monies designed to offset the medical costs of the state, opting instead to currently appropriate only the future income stream.

Game the system! Several state legislatures, including that of Mississippi, enacted a tax specifically upon health care providers designed to increase the states’ share of the federal matching Medicaid reimbursement dollars—an annually adjusted “match” for poor states that often has exceeded 80%. Should taxpayers be offended when state legislatures “game the system” by artificially inflating reimbursed Medicaid costs with a provider tax, which does not provide any health care for needy citizens, but simply adds tax dollars to the state’s revenues as well as increasing federal matching dollars without delivering a tangible health care benefit or incurring a real expenditure of funds to help truly needy citizens?

I found the original article to be an accurate portrayal of one aspect of the complicated federal Medicaid eligibility criteria, which also permits recoupment of the state expenditures from the recipient’s resources without the state’s necessarily returning the federal matching funds it had previously received.

I trust the letter writer’s outrage is motivated by genuine concern for the Medicaid system to help truly needy citizens, that he is a CPA legislator in the process of learning the complicated system and not simply making a political statement.

John Suter, CPA
Jacksonville, Florida