Recent business headlines, particularly those related to the collapsed energy-trading giant, Enron and its auditor, Arthur Andersen raise concerns about accountants' ethical reasoning. We propose, and provide evidence from 90 new auditors from Big-Five accounting firms, that a selection-socialization effect exists in the accounting profession that results in hiring accountants with disproportionately higher levels of the Sensing/thinking (ST) cognitive style. This finding is important and relevant because we also find that the ST cognitive style is associated with relatively low levels (...) of ethical reasoning, regardless of gender. This finding implies a need for emphasis on the ethical training of accountants. The results also suggest that accounting firms should consider recruiting accountants with cognitive styles associated with relatively higher levels of ethical reasoning. (shrink)

Integrating personality, behavioral, and cognitive theories of change, the author examines the operations, measurement, and evolution of behavioral and ethical standards that distinguish capitalism from other ideologies.

Every year in this country, some 10,000 college and university courses are taught in applied ethics. And many professional organizations now have their own codes of ethics. Yet social science has had little impact upon applied ethics. This book promises to change that trend by illustrating how social science can make a contribution to applied ethics. The text reports psychological studies relevant to applied ethics for many professionals, including accountants, college students and teachers, counselors, dentists, doctors, journalists, nurses, school teachers, (...) athletes, and veterinarians. Each chapter begins with the research base of the cognitive-developmental approach--especially linked to Kohlberg and Rest's Defining Issues Test. Finally, the book summarizes recent research on the following issues: * moral judgment scores within and between professions, * pre- and post-test evaluations of ethics education programs, * moral judgment and moral behavior, * models of professional ethicseducation, and * models for developing new assessment tools. Researchers in different professional fields investigate different questions, develop different research strategies, and report different findings. Typically researchers of one professional field are not aware of research in other fields. An important aim of the present book is to bring this diverse research together so that cross-fertilization can occur and ideas from one field can transfer to another. (shrink)

In three studies, factors influencing the incidence of fraudulent financial reporting were assessed. We examined (1) the effects of personal values and (2) codes of corporate conduct, on whether managers misrepresented financial reports. In these studies, executives and controllers were asked to respond to hypothetical situations involving fraudulent financial reporting procedures. The occurrence of fraudulent reporting was found to be high; however, neither personal values, codes of conduct, nor the interaction of the two factors played a significant role in fraudulent (...) financial reporting. (shrink)

This study provides evidence regarding the level of ethical cognition of business students at the entry to college as compared to a national norm. It also provides comparative evidence on the effects of group versus individual ethical cognition upon completion of a business ethics course. The Principled Score (P-score) from the Defining Issues Test (DIT) was used to measure the ethical cognition of a total sample of 301 business students (273 entering students plus 28 students in a business ethics course). (...) The results indicate that (1) business students are not significantly different from the national norms at entry to college and (2) group reasoning helps male students improve their P-scores significantly in the business ethics course at a loss of P-score (albeit not statistically significant) for female students. (shrink)

This paper examines the relationship between organizational ethical culture in two large international CPA firms, auditors'' personal values and the ethical orientation that those values dictate, and judgments in ethical dilemmas typical of those that accountants face. Using an experimental task consisting of multiple judgments designed to vary in "moral intensity" (Jones, 1991), and unique as well as tried-and-true approaches to variable measurements, this study examined the judgments of more than three hundred participants in our study. ANCOVA and path analysis (...) results indicate that: (1) Ethical judgments in situations of high moral intensity are affected by personal values and by environmental variables, such as the professional code of conduct (direct and indirect effects) and previous ethics instruction (direct effect only). (2) Corporate ethical culture, and a relatively strong firm rules-orientation, affect auditors'' idealism but not relativism, and therefore indirectly affect ethical judgments. Jones'' (1991) moral intensity argument is supported: differences in the characteristics of specific judgment tasks apparently result in different decision processes. (shrink)

Public accounting in the United States is generally guided by the Code of Professional Conduct of the American Institute of Certified Public Accountants (AICPA). It has been suggested that education in understanding and accepting their ethical code would increase accountants' adherence and ethicality.This study was designed to examine the level of consensus to AICPA ethical standards by accounting students (ethical orientation). Situation ethics provided the theoretical rationale for this study.