This review summarizes and critiques the empirical ethical decision-making literature from 1996–2003. One hundred and seventy-four articles were published in top business journals during this period. Tables are included that summarize the findings by dependent variable – awareness, judgment, intent, and behavior. We compare this review with past reviews in order to draw conclusions regarding trends in the ethical decision-making literature and to surface directions for future research.

Accounting ethics failures have seized headlines and cost investors billions of dollars. Improvement of the ethical reasoning and behavior of accountants has become a key concern for the accounting profession and for higher education in accounting. Researchers have asked a number of questions, including what type of accounting ethics education intervention would be most effective for accounting students. Some researchers have proposed virtue ethics as an appropriate moral framework for accounting. This research tested whether Smithian virtue ethics training, based on (...) Adam Smith’s “The Theory of Moral Sentiments”, is effective in improving accounting student’s cognitive moral development. This research used a pre-test, treatment, post-test, quasi-experimental design utilizing the Defining Issues Test 2 instrument to measure students’ CMD. Analysis of DIT-2 gain scores did show a significant improvement in subjects’ personal interest scores and a significant improvement in an overall measure of CMD, the DIT N2 index, whereas their DIT-2 post-conventional scores did not improve significantly. This research supports the proposition that the concepts contained in Smithian virtue ethics can contribute to an effective accounting ethics education intervention. However, further research is required to determine what concepts should be included to improve accounting students’ post-conventional moral reasoning. (shrink)

In this exploratory paper, we investigate the extension of Haidt’s :814–834, 2001, The righteous mind: Why good people are divided by politics and religion, 2012) Moral foundations theory, operationalized as the MFQ30 questionnaire, from a sample of the general public across many countries to a sample of business students. MFT posits that people rely on five major concerns, or foundations, when making moral judgments. The five concerns are care/harm, fairness/cheating, loyalty/betrayal, respect/authority, and purity/degradation. In addition, Haidt suggests that intuition, rather (...) than reasoning, leads to moral judgment. We replicate Haidt’s measurement model and find that the measurement model based on our sample is consistent. This indicates support for MFT. Further, we find structural differences in the measurement model between the genders and between areas of study. Our findings suggest that all students in the sample focus substantially on the fairness foundation. Ethics education and research may seek to expand the number of moral foundations individuals consider when discerning whether something is right or wrong. (shrink)

The purpose of this study was to determine whether accounting students’ perception of moral intensity could be enhanced through a limited ethics intervention in an Advanced Accounting course. Ethical decisions are heavily influenced by the intensity of the moral problem: the more egregious the act, the more the people view it as unethical. This controlled experiment measures the change in perceptions of moral intensity with the pre- and post-test instruments using five accounting specific vignettes containing moral dilemmas which are progressively (...) more intense. While other studies have shown that perceived moral intensity directly influences a persons’ moral decision-making process, as far as we are aware, this is the first study that assesses and tests whether the coverage of specific ethics content integrated into an accounting class can positively influence the students’ perception of moral intensity, moral sensitivity/awareness, moral judgment, and moral intentions. Positively influencing students’ moral sensitivity/awareness, moral judgment, and moral intentions is a critical first step to ensuring that our courses and curricula provide the learning environment in which students can develop knowledge and competencies required to become the ethical leaders of tomorrow. (shrink)

This research is motivated by the criticism levelled at the academic community for its failure to incorporate sufficient ethics education into the accounting curriculum :53–71, 2004; Madison and Schmidt 2006). The inclusion of ethics decision-making frameworks by professional bodies in their codes of conduct or as a standalone tool and the encouragement of their use as a part of ethics education to help students to identify and think through ethical issues in a business context has been subject to very limited (...) research to date. The aim of this study is to provide evidence of the impact of providing a framework on its own and providing a framework as part of a comprehensive integrated ethics education component of a first-year unit of study, on accounting students’ ethical sensitivity and judgment. Results indicate that providing students with a framework only does not increase students’ ethical sensitivity but does support their ethical judgment. In contrast, the integrated ethics component does increase student’s ethical sensitivity, however, an unexpected finding of this study is that increases in students’ ethical judgement are greater if they have not been previously exposed to the framework. Taken together, our findings suggest that it is the framework that has a significant impact on students’ ethical judgment, while an integrated ethics education can expose students to a range of ethical issues and thereby improve their ethical sensitivity, a critical component which initiates the ethical decision-making process. (shrink)

The proportion of business ethics literature devoted to accounting and the proportion of academic accounting literature devoted to ethical issues are both small, yet over the past two decades there has been a steady accumulation of research devoted to ethical issues in accounting. Based on a database of more than 500 articles gathered from a wide range of accounting and business ethics academic journals, this paper describes and analyses the characteristics of what has been published in the past 20 years (...) or so. It identifies and explores patterns and trends in publication outlets and the type of research conducted. Furthermore, through a comparison with issues that have been raised in the general business ethics literature, it offers guidance to researchers who intend to take the field of accounting ethics forward using empirical methods. (shrink)

This study provides empirical evidence in relation to a growing body of literature concerned with the ‘socialisation’ effects of accounting and business education. A prevalent criticism within this literature is that accounting and business education in the United Kingdom and the United States, by assuming a ‘value-neutral’ appearance, ignores the implicit ethical and moral assumptions by which it is underpinned. In particular, it has been noted that accounting and business education tends to prioritise the interests of shareholders above all other (...) stakeholder groups. This paper reports on the results of a set of focus group interviews with both undergraduate accounting students and students commencing their training with a professional accounting body. The research explores their perceptions about the purpose of accounting and the objectives of business. The findings suggest that both university and professional students' views on these issues tend to be informed by an Anglo-American shareholder discourse, whereby the needs of shareholders are prioritised. Moreover, this shareholder orientation appeared to be more pronounced for professional accounting students. (shrink)

Recent developments in the business world have caused the academic community to address the coverage of ethics in the accounting curriculum. This study surveyed accounting faculty to: (1) examine perceptions about ethics coverage in the undergraduate accounting courses; (2) identify teaching methods used to include ethics in the undergraduate accounting courses, the perceived effectiveness of those methods and the amount of time spent on ethics coverage; and (3) to identify problems encountered in including ethics in accounting courses. The study found (...) that although a large majority of the professors surveyed (77%) said they include ethics, 69% felt that there was a need for more ethics coverage. Also, the study revealed that while the lecture method was the most commonly used method, the written case was deemed the most effective method. The average time spent covering ethics was a little over 3 hours per course. The most significant problems encountered by faculty who include ethics in their undergraduate accounting courses was not enough time and lack of appropriate ethics materials. (shrink)

Accounting educators are being called on to provide a greater emphasis on ethics education. This paper examines three important issues concerning ethics education in accounting. First, the question of whether ethics can indeed be taught is examined. Next, several innovative approaches are presented which have been used by accounting educators to integrate ethics into the classroom. Finally, results of a survey of students concerning their perspectives of ethical issues in accounting education, the accounting profession, and society at large are presented (...) and discussed. Survey results reveal that students consider a lack of ethics damaging to the accounting profession and society. Results also indicate that accounting students are seeking ethical and moral direction. (shrink)

This paper reviews the current commitment of accounting academics to teaching accounting ethics. In the course of the review it assesses the recent initiative of the American Accounting Association; namely, Ethics in the Accounting Curriculum: Cases and Readings, 1994. This collection of cases has not been widely adopted despite an identified lack of case materials available to those teaching accounting ethics. The question becomes whether the lack of adoption suggests that accounting academics are not particularly interested in incorporating ethical issues (...) in the classroom or whether there are difficulties with the quality of the collection. The paper continues by examining the current state of research in accounting ethics and again asks what this tells us about commitment to teaching accounting ethics. While the conclusions of this examination are far from definitive, there are signs that all is not well with the accounting ethics discipline. (shrink)

There are many ways that accountants and managers can influence the reported accounting results of their organizational units. When such influence is directed at changing the amount of reported earnings, it is known as earnings management. The purpose of this paper is to present the results of surveys of undergraduate students, MBA students, and practicing accountants concerning their attitudes on the ethical acceptability of earnings management. Analysis of the survey results reveals how the attitudes of the three groups differ and (...) what variables are associated with these differences. Based on the analysis, the authors suggest changes in accounting education curriculum and ethics awareness programs in business which might increase students'' and practitioners'' sensitivity to the ethical ramifications of earnings management. (shrink)

Despite a wealth of prior research, little consensus has arisen about the goals and effectiveness of business ethics education. Additionally, accounting academics have recently been questioned as to their commitment to accounting ethics education. The current study examines whether accounting students' perceptions of business ethics and the goals of accounting ethics education are fundamentally different from the perceptions of accounting faculty members. The study uses a survey instrument to elicit student and faculty responses to various questions concerning the importance of (...) business ethics and accounting ethics education. Statistical analyses indicate that students consider both business ethics and the goals of accounting ethics education to be more important than faculty members. Implications of these results for accounting faculty members interested in accounting ethics education are discussed. (shrink)

Motivated by the call for more research on students’ perceptions of their ethical development in business education programs, this study examines students’ reflections on how their understanding of ethics was challenged and/or changed, and what facilitated the development of ethical decision-making approaches in a first-year accounting course. The results indicate that students developed more sophisticated and contextualised views of ethical issues in business, government and social contexts including the need to consider their impact on various stakeholders. Students attributed this development (...) to the various elements in the integrated course design including the real cases sourced in current newspaper articles, an ethical decision-making framework with various ethical perspectives, the reflective journal component and the ability to work in groups. These findings have implications for the design of effective ethics education programs in business. (shrink)

In light of the myriad accounting and corporate ethics scandals of the early 21st century, many corporate leaders and management scholars believe that ethics education is an essential component in business school education. Despite a voluminous body of ethics education literature, few studies have found support for the effectiveness of changing an individual's ethical standards through programmatic ethics training. To address this gap in the ethics education literature the present study examines the influence of an underlying social cognitive error, called (...) pluralistic ignorance. We believe that if pluralistic ignorance is reduced, the result will be more effective business ethics education programs. Eighty undergraduate management students participated in this longitudinal study, and a mixed-model ANOVA revealed that the reduction of pluralistic ignorance resulted in higher personal ethical standards over the course of a semester, when compared to a class that did not receive a formal ethics education program as part of their course. We discuss the implications of pluralistic ignorance in training business ethics and ethics education. (shrink)

This article uses bibliometric analysis to empirically examine research on business ethics published in a broad set of journals, focused over the period 1988-2007. We consider those journals with an emphasis on accounting. First, we determine the citation frequencies of documents to identify the core articles in accounting research with an ethics focus as well as the contributions of influential fields included in the research sphere of these journals. We also employ document co-citation analysis to analyze the scholarly communication patterns (...) that exist within the realm of the specified articles. Second, we utilize social network analysis tools to profile the centrality features of the co-citation network of these documents. (shrink)

In this paper I discuss the advantages and challenges of using active learning, when teaching an accounting ethics course offered in higher education . The willingness of an instructor to use active learning in an accounting ethics course may be influenced at least in part by that instructor’s assessment of the advantages and challenges of using active learning. Consequently, my paper may be of assistance to instructors with experience in teaching an accounting ethics course and to instructors who are preparing (...) to teach their initial accounting ethics course. (shrink)

Ethical instruction is critical for trainee accountants. Various teaching methods, both active and passive, are normally utilised when teaching accounting ethics. However, students’ learning styles are rarely assessed. This study evaluates the learning styles of accounting students and assesses the interaction of teaching methods and learning styles in an ethics instruction environment. The ethical attitudes and preferred learning styles of a cohort (137) of final year accounting students were evaluated pre-instruction. They were then subject to three different teaching methods while (...) studying ethics during an auditing course. When ethical attitudes and preferred learning styles were re-assessed post-instruction, the teaching methods were found to have influenced active learners more than passive ones. Furthermore, when learning styles matched teaching methods used, usefulness was assessed as high but when learning styles and teaching methods differed, usefulness deteriorated significantly. Students displayed a preference for passive learning styles, despite being so advanced in their education. The implications are that instructors should consider learning styles before deciding on appropriate teaching methods, in accounting ethics environments. (shrink)

The field of behavioral ethics has seen considerable growth over the last few decades. One of the most significant concerns facing this interdisciplinary field of research is the moral judgment-action gap. The moral judgment-action gap is the inconsistency people display when they know what is right but do what they know is wrong. Much of the research in the field of behavioral ethics is based on early work in moral psychology and American psychologist Lawrence Kohlberg’s foundational cognitive model of moral (...) development. However, Kohlberg’s model of moral development lacks a compelling explanation for the judgment-action gap. Yet, it continues to influence theory, research, teaching, and practice in business ethics today. As such, this paper presents a critical review and analysis of the pertinent literature. This paper also reviews modern theories of ethical decision making in business ethics. Gaps in our current understanding and directions for future research in behavioral business ethics are presented. By providing this important theoretical background information, targeted critical analysis, and directions for future research, this paper assists management scholars as they begin to seek a more unified approach, develop newer models of ethical decision making, and conduct business ethics research that examines the moral judgment-action gap. (shrink)

Accountants are neither devoid of ethical dilemmas nor are they immune from financial scandals. In order to improve the credibility of the profession, it is important to study the personal values that qualified and trainee accountants consider important. Using Maccoby's instrument, which measures ‘head’ and ‘heart’ values, qualified accountants (chartered and certified) and trainee accountants were surveyed for the first time in a European Union member country (Cyprus) to ascertain their character ethical traits/personal values. Accountants were found to value ‘head’ (...) more than ‘heart’ traits and there were no gender differences. For male respondents, age and years of professional experience were significant correlates of the importance attributed to head traits, while having religious beliefs was associated with valuing heart traits more. Finally, the implications for accounting education and the professional bodies are considered. (shrink)

Since there are so few controls over detecting and preventing faculty misconduct, one of the most common ways in which it is discovered is through student reports. Given the importance of student reports in bringing to light faculty’s ethical lapses, this paper seeks to understand what factors influence students’ likelihood to report faculty misconduct. We develop an empirical model that integrates the decision process of the Prosocial Organizational Behavior Model with insights from the emotional perspective on whistleblowing. Specifically, we use (...) an experimental survey to examine how students’ perceived unfairness of the faculty misconduct, feelings of anger, and the students’ self-interest in the situation in conjunction with situational “cues for inaction” lead to the intention to blow the whistle. Overall, the results from our structural model partially support our theoretical model. Interestingly, these findings demonstrate that, in the case of faculty member misconduct, anger and perceptions of unfairness play a greater role than the more rational cost-benefit process of the POB model. These results could aid in development of ethics education for students and could also inform the development of university policies that encourage students to come forward when faced with faculty misconduct. (shrink)

This paper advocates inclusion of a wider set of ethical theories into the accounting canon. We find that the mainstream accounting curriculum does not adequately engage with non-Western ethical theories or contemporary Western ethical thought, as evidenced by the ethics content of core accounting texts and the International Federation of Accountants’ ethics publications. We suggest adopting a ‘thematic’ approach to teaching ethics as an integrated part of accounting curricula. This approach addresses two competing principles implicit in International Education Standard 4: (...) (i) that all accountants need to be educated to meet global ethical standards, and (ii) that teaching ethics should accommodate ethical traditions and practices that could vary between nations and cultures. The thematic approach we propose requires less additional space within existing accounting curricula and less additional preparation by accounting educators than the alternative approach of teaching substantive ethical theories from a sufficiently diverse range of cultures and traditions. The paper also provides exemplars of this thematic approach to teaching ethics in accounting. (shrink)

This study investigates the differences in individuals'' ethical decision making between Canadian university business students and accounting professionals. We examine the differences in three measures known to be important in the ethical decision-making process: ethical awareness, ethical orientation, and intention to perform questionable acts. We tested for differences in these three measures in eight different questionable actions among three groups: students starting business studies, those in their final year of university, and professional accountants.The measures of awareness capture the extent to (...) which respondents felt that a particular action was unethical according to each of several ethical criteria. We found few differences between the two student groups on these measures, suggesting that their education had minimal effect on raising their awareness of the ethical issues in the vignettes. Indeed, overall, the graduating student''s scores were marginally lower than those of the entry-level students. However, the professionals viewed some actions as significantly less ethical than did the graduating students. (shrink)

While there is considerable support for integrating ethics education in accounting curricula, research presents conflicting evidence on how best to incorporate it. A review of accounting ethics scholarship highlights criticisms of the literature, including limited research into actual behavior and a lack of theory. We report the results of a study that is theory based, captures behaviors rather than attitudes, and explores the effect of repeated practice to develop voice efficacy. We examine the impact of two types of ethics instructions. (...) Across four classes in an accounting curriculum, one student cohort participated in traditional ethics instruction, while the other cohort participated in Giving Voice To Values instruction. We collected student responses to an ethical challenge and conduct a between-subject analysis. The results reveal consistent unethical behavior in the traditional cohort but not in the GVV cohort, indicating that faculty should consider the use of this pedagogy in accounting ethics education. (shrink)

This study examined experimentally the effect of retaliation strength and accounting students’ level of moral reasoning, on their propensity to blow the whistle (PBW) when faced with a serious wrongdoing. Fifty-one senior accounting students enrolled in an auditing course offered by a large New Zealand university participated in the study. Participants responded to three hypothetical whistle-blowing scenarios and completed an instrument that measured moral reasoning (Welton et al., 1994, Accounting Education . International Journal (Toronto, Ont.) 3 (1), 35–50) on one (...) of two conditions – i.e., strong or weak retaliation for whistle-blowing. Consistent with the results of Arnold and Ponemon (1991, Auditing: A Journal of Practice and Theory 10 , 1–15) this study found that the strength of retaliation and participants’ moral reasoning level positively affected their PBW. Unlike results reported in Arnold and Ponemon (1991, Auditing; A Journal of Practice and Theory 10 , 1–15) a significant interaction effect of moral reasoning level and retaliation on participants’ PBW was not found. However, results showed that a participant’s gender has a significant effect on the relationship between his or her moral reasoning level and PBW. These results support the need to improve ethical awareness through accounting education and to increase protection for whistle-blowing (Miceli 2004, Journal of Management Inquiry 13 , 364–366). Furthermore, many participants found it difficult to take a stand when serious wrongdoing is discovered. Therefore, policymakers must exercise caution when placing heavy reliance on whistle-blowing, especially when whistle-blower protection processes are complex and not easily accessible, and processes to facilitate whistle-blowing may vary substantially between public and private sector organizations (Scholtens, 2003, Review of the operation of the Protected Disclosures Act 2000: Report to the Minister of State Services ). (shrink)

We examine the impact of an ethics education program on reporting behavior using two groups of students: fourth year Masters of Accounting students who just completed a newly instituted ethics education program, and fifth year students in the same program who did not receive the ethics program. In an experiment providing both the opportunity and motivation to misreport for more money, we design two social condition treatments – anonymity and public disclosure – to examine whether or to what extent ethical (...) values are internalized by students. We find that when participants are anonymous, misreporting rates are nearly the same regardless of ethics program participation. However, when their reporting behavior is made public to the cohort, participants who completed the ethics program misreported at significantly lower rates than those who did not receive the ethics program. The results suggest that ethics education does not necessarily result in internalized ethical values, but it can impact ethical behavior. (shrink)

Recent accounting scandals involving the collapse of large corporate firms have brought into question the adequacy of ethics education within accounting programs. This paper investigates the ethical decisions of accountancy students and in particular analyses the effect of group (as opposed to individual) decision-making on ethical decisions. Final year accountancy students (sample size of 165) were randomly allocated into two experimental conditions. The participants were then presented with five (5) ethical vignettes. One experimental condition involved completing the ethical decisions as (...) individuals (60). The other involved completing the ethical decision-making as a group of 3–4 participants (34). A consistent pattern of behaviour was observed in the analysis of individual versus group responses. Individuals displayed stronger tendencies than groups to take the extreme actions of acting either unethically or ethically (whistleblowing), whereas groups displayed stronger tendencies to take the safer (neutral) options. It was concluded that groups reached consensus decisions, in an ethical context, probably as a result of peer pressure. The significant implication of this finding is in relation to the emphasis accounting programs place on group work. Group work may enhance students’ abilities to work as a team. However, as revealed in this study’s results, group work may not be an effective means of producing the optimal decision in all subject matter areas, especially complex areas such as ethical decision-making. (shrink)

This study provides empirical evidence in relation to a growing body of literature concerned with the ‘socialisation’ effects of accounting and business education. A prevalent criticism within this literature is that accounting and business education in the United Kingdom and the United States, by assuming a ‘value‐neutral’ appearance, ignores the implicit ethical and moral assumptions by which it is underpinned. In particular, it has been noted that accounting and business education tends to prioritise the interests of shareholders above all other (...) stakeholder groups. This paper reports on the results of a set of focus group interviews with both undergraduate accounting students and students commencing their training with a professional accounting body. The research explores their perceptions about the purpose of accounting and the objectives of business. The findings suggest that both university and professional students' views on these issues tend to be informed by an Anglo‐American shareholder discourse, whereby the needs of shareholders are prioritised. Moreover, this shareholder orientation appeared to be more pronounced for professional accounting students. (shrink)

Business ethics attracts increasing attention from business practitioners and academic researchers. Concerns over fraudulent behavior keep attentionfocused on ethics in businesses. The accounting profession pays particularattention to matters of ethical judgment. The profession has adopted a strictcode of conduct and many states require the passage of an ethics exam to gaincertification. The more that is understood about the relationship of gender and ethics, the better chance of education and training programs will bedesigned to improve ethical awareness and sensitivity. Prior studies (...) have found that personal characteristics are an important aspect of cultural norms.This study analyzes the responses of students from eight different countries toquestions on their probable actions to an ethical dilemma. (shrink)

The current environment of business and financial corruption in Spain has increased in recent years. In order to reduce the scope of this problem, the Spanish Criminal Code has introduced codes of conduct and ethics to encourage a new culture of respecting laws for companies and employees. An Educational Innovation Group at the University of Extremadura has proposed a cross-sectional model to study ethics, in an effort to address concerns about the consequences of illegal acts in society and companies. Students (...) in Business, Finance and Accounting are required to practice ethical decision-making through court judgments in order to develop “ethical competences”. These competences are included in the European Higher Education Area and the Official University Education in Spain, specifically in the Royal Decree 1393/2007, of 29 October through cross-sectional competences within the academic programmes. The results of the study show that a high percentage of students validate this methodology as a way of improving ethical decision-making skills at University that will be applied to future business practices. (shrink)

The main contention of this paper is that our ability to embed a consideration of values into business school curricula is hampered by certain normative parameters that our students have when entering the classroom. If we don’t understand the processes of valuation that underpin our students’ reasoning, our ethics teaching will inevitably miss its mark. In this paper, we analyze one of the most prevalent metaphors that underpin moral arguments about business, and reveal the beliefs and assumptions that underpin it. (...) By revisiting the content of Adam Smith’s “invisible hand” metaphor, we show that the moral content of the metaphor has been significantly misconstrued through its subsequent reception in economic theory. The “Giving Voice to Values” pedagogy aims to enable students to act on their tacit values and address the rationalizations that they may encounter for not acting on these values. We believe our analysis can strengthen the employment of GVV in three ways: understanding tacit blockages to moral action, i.e., how students’ belief in the moral efficacy of the invisible hand could undermine their own sense of moral duty; addressing common rationalizations that may emerge from different assumptions about morally appropriate courses of action in the workplace; and resolving values conflicts on how to act. (shrink)

A growing body of literature places blame for accounting frauds on the failure of educators to implement ethics training in accounting curriculums in higher educational institutions. Although, the professional accountancy bodies in the UK espouse high ethical standards, others suggest that these bodies are failing to cover ethics in any meaningful way. This study surveys faculty about what is being taught and how much time is dedicated to ethics training. This is the first study to examine whether content suggested by (...) the Ethics Education Framework has been implemented in curriculums in the UK. In addition, we look to determine if there is a notable difference between what is covered in both pre-1992 and post-1992 UK universities. Although we find that post-1992 institutions have implemented the EEF suggestions more than pre-1992 UK universities, current ethics training is insufficient and has not changed much over the last two decades. (shrink)

The purpose of this paper is to propose a framework of ethics education that promotes the structured learning of ethics in the accounting discipline. The Ethics Education Framework (EEF) is based on three key inter-related components that includes: Rest’s (1986) Four-Component Model of ethical decision-making and behaviour; the key cognitive and behavioural objectives of ethics education; and the discrete and pervasive approaches to delivering content. The EEF providesuniversity students and professional accountants a structure to learn to identify, analyse, and resolve (...) ethical issues to the point of action. The EEF is a four-stage learning continuum represented as a set of building blocks which introduces ethical concepts and then reinforces and develops new levels of understanding with progressive stages. This paper describes the EEF, and includes a discussion of how it compares with other ethics education models, and an analysis of the support through responses by professional organisations (based on an Exposure Draft issued by the International Federation of Accountants (IFAC), as the initial International Education Practice Statement). The IFAC has now revised its International Education Standard (IES 4) in relation to ethics, with a commentary period till July 2011. (shrink)

The purpose of the present study is to examine the attitudes of Portuguese chartered accountants with respect to questions of ethical nature that can arise in their professional activity. Respondents were asked to respond to the Ethics Position Questionnaire developed by Forsyth (Journal of Personality and Social Psychology 39(1), 175–184, 1980), in order to determine their idealism and relativism levels. Subsequently, they answered questions about five scenarios related to accounting practices, with the objective of measuring their ethical judgments. Based on (...) the idealism and relativism levels of our respondents, they were classified into one of four groups, representing different ethical ideologies (absolutism, exceptionism, subjectivism, and situationism). The results indicated that age was the major determinant of relativism. Contrary to previous research, older respondents revealed themselves significantly more relativistic than younger ones. Gender seems to be the most important determinant of ethical judgments; against expectations, men evidenced significantly stricter judgments than women in two of the five scenarios. Findings also indicated that respondents’ ethical judgments did not differ significantly based on their ethical ideology, supporting the idea that ethical ideology is not an important determinant of ethical judgments. (shrink)

Accounting educators are in the midst of creating new opportunities for students to enhance their abilities to recognize ethical dilemmas, establish criteria by which to make ethical decisions, and establish support mechanisms and strategies to facilitate their ethical decision-making. CPA firms, professional organizations and state boards of accountancy are co-operating to increase requirements for ethics education for candidates taking the CPA exam. The current situation is confusing and sub-optimal regarding the use of precious learning time in college programs. A new (...) dialogue between the three stakeholders, creative learning approaches, and additional resources can lead to a more consistent and optimal learning paradigm regarding the ethics education of accountants. Research evaluating the effectiveness of various approaches is needed to effectively apply limited resources in an area critical to the reputation capital of the accounting profession. (shrink)

Ethical conduct in practice has been increasingly recognised as vital to the accountancy profession following the collapse of Andersen. The foundational principles underpinning accountancy ethics receive relatively uniform recognition worldwide so that this paper concentrates on exploring how to introduce these concepts into established courses at undergraduate level. Historically, the teaching of accounting techniques has been isolated from the personal assimilation of accountancy's ethical values by students. Alternative approaches are considered, of a dedicated 'capstone' ethical course or through more progressive (...) integration within existing parts of an established curriculum. An opportunistic example of the latter is then described with the rationale, potential benefits, student reactions and practical difficulties assessed. Overall, the paper explains why, alongside technical skills, their personal development requires undergraduates to develop how to apply for themselves given professional values. It contributes suggestions as to methodologies, content and material for short modules within financial reporting, taxation, auditing and social/environmental accountancy courses while reflecting on the limitations and potential of their use. (shrink)

Numerous researchers have investigated accounting students’ levels of moral reasoning, ethical choice and judgment employing the Defining Issues Test and using its P score as an indicator of moral reasoning. Not surprisingly, a number of DIT studies report conflicting results. Moreover, despite widespread use of the DIT, there is concern that it may not adequately measure all facets of ethical judgment :1–26, 2010). Thus, we endeavor to provide insight not only into the contradictory results but also about the applicability of (...) the DIT for studying accounting students. To do so, we collect published and unpublished DIT studies employing accounting students as subjects and use meta-analysis to aggregate findings across these studies to quantify their results, examining commonly employed variables. We show significant relationships between P scores and some variables but not others. Further, our findings demonstrate that the DIT provides added insights when exploring questions of ethical choice, and ethics instruction, particularly when the instruction is embedded in an accounting course. Finally, we find that the level of DIT P scores reported in the studies relates to whether the study was published. We discuss the implications of our findings for future research. (shrink)

Recently within the critical accounting literature Funnell (1998) has argued that accounting was implicated in the Holocaust. This charge is primarily related to the technical, mathematical nature of accounting and its ability to dehumanise individuals. Broadbent (1998, see also DeMoss and McCann, 1997) has also contended that "accounting logic" excludes emotion. She suggests that a more emancipatory form of accounting could be possible if emotion were given a voice and allowed to be heard within accounting discourse (see also Kjonstad and (...) Wilmott, 1995). This paper contends that emotion should be introduced into accounting education and in particular emotional commitment to other individuals should be encouraged. It is suggested that one way to do this may be through business ethics education. It is also suggested that increasing ethical commitment to other individuals may go some way towards combating the tendency for accountancy to dehumanise other people. While there have been specific studies of ethics and accounting education there has, as yet, been little open debate about what the objectives of accounting ethics education should be or the specific techniques that could be used to meet the desired aims. This paper contends that accountancy has become dangerously dehumanised and that one of the most important objectives for any business ethics education must be to develop an empathy with "the other". The paper studies the developments within the medical, legal and engineering profession in order to suggest some specific methods which could be employed in order to re-humanise accountancy and develop a sense of moral commitment towards other individuals. (shrink)

Recently, society and the accounting profession have become increasingly concerned with ethics. Accounting researchers have responded by attempting to investigate and analyze the ethical behavior of accountants. While the current state of ethical behavior among practitioners is important, the ability of accountants to detect ethical problems that may not be obvious should also be studied and understood. This study addresses three questions: (1) are auditors alert to ethical issues; (2) if so, how important do they perceive them to be; and (...) (3) what factors affect their sensitivity threshold and their perceptions of the importance of the issues?Most of the prior research in accounting ethics presents subjects with scenarios that contain an obvious ethical issue, and subjects realize that they are participating in an ethics study. In the present study, the ethical problems are integrated into general accounting situations in order to discover the sensitivity of accounting professionals to them. This study defines ethical sensitivity as the ability to interpret a given situation and to realize that a moral problem exists. (shrink)

The accounting profession has emphasized the need for ethics education in the accounting curriculum. The current study examines professional commitment and anticipatory socialization, operationalized by perception of financial reporting, as possible determinants of Accounting students' ethical perceptions and intentions. Accounting students with higher levels of professional commitment and higher perception of the importance of financial reporting were more likely to perceive questionable actions as unethical and less likely to engage in such actions compared to those students with lower commitment and (...) lower perception of financial reporting. The results have implications for accounting instructors and accounting employers as they socialize students in the accounting profession at this early stage. (shrink)

In recent years, and in close connection with a number of well-known financial malpractice cases, public debate on business ethics has intensified worldwide, and particularly in ethics-unfriendly environments, such as Spain, with many recent fraud and corruption scandals. In the context of growing consensus on the need of balancing social prosperity and business profits, concern is increasing for introducing business ethics in higher education curricula. The purpose is to improve ethical behaviour of future business people, and of accounting professionals in (...) particular. In this study, from a sample of 551 business students at a Spanish university, the importance of accounting ethics is investigated. The aim of this paper is twofold. First, we attempt to examine students’ overall perceptions of business ethics in unfriendly environments and, specifically, their views on the importance and goals of accounting ethics education. Second, we intend to investigate whether potential differences in such perceptions depend on previous business ethics courses taken, gender, and age of students. Our results show that those students who have previously taken an ethics course are especially prone to considering that accounting education should include ethical considerations, and show greater interest in further introducing this subject in their curricula. These facts should encourage universities offering business degrees in ethics-unfriendly environments to extend the implementation of ethics courses in their curricula. Besides, significant differences in students’ perceptions on the importance of accounting ethics are found depending on their gender and age. In line with previous research findings, female and older students show more ethical inclinations than, respectively, male and younger students. Thus, ethics-unfriendly environments can be treated as contexts where general trends on students’ ethical attitudes are also clearly visible. This fact, together with the evidenced impact of ethics courses on students’ ethical inclinations, places ethics-unfriendly environments as crucial research settings for further inquiring into the nuances that help explain students’ attitudes towards accounting ethics and the role of ethics courses in business degree curricula. (shrink)

This study explores the influence of ethics education on accounting students’ level of ethical reasoning in Tunisia. Based on cognitive developmental theory, we tested the effectiveness of an ethics intervention before and after ethics education with a control group. A triangulated research design was incorporated. Experimental and qualitative methods were used to control for experimental bias. This study revealed that the progress of moral development was not significant between the pre-test and the post-test. Data analysis revealed the primary challenges in (...) teaching ethics in the Tunisian audit context. Through a confirmatory qualitative survey, stating “the consequences of unethical behaviour in the long term” demonstrates that the intervention meets the primary interest of this study, and it may influence auditors’ decisions and their perceptions of the potential consequences of their decisions. (shrink)

This study investigates the association of a broad set of variables with the ethical decision making of management accountants in Libya. Adopting a cross-sectional methodology, a questionnaire including four different ethical scenarios was used to gather data from 229 participants. For each scenario, ethical decision making was examined in terms of the recognition, judgment and intention stages of Rest’s model. A significant relationship was found between ethical recognition and ethical judgment and also between ethical judgment and ethical intention, but ethical (...) recognition did not significantly predict ethical intention—thus providing support for Rest’s model. Organizational variables, age and educational level yielded few significant results. The lack of significance for codes of ethics might reflect their relative lack of development in Libya, in which case Libyan companies should pay attention to their content and how they are supported, especially in the light of the under-development of the accounting profession in Libya. Few significant results were also found for gender, but where they were found, males showed more ethical characteristics than females. This unusual result reinforces the dangers of gender stereotyping in business. Personal moral philosophy and moral intensity dimensions were generally found to be significant predictors of the three stages of ethical decision making studied. One implication of this is to give more attention to ethics in accounting education, making the connections between accounting practice and Islam. Overall, this study not only adds to the available empirical evidence on factors affecting ethical decision making, notably examining three stages of Rest’s model, but also offers rare insights into the ethical views of practising management accountants and provides a benchmark for future studies of ethical decision making in Muslim majority countries and other parts of the developing world. (shrink)

Ethics in accounting and ethical education have seen an increase in interest in the last decade. However, despite the renewed interest some important shortcomings persist. Generally, rules, principles, values and virtues are presented in a fragmented fashion. In addition, only a few authors consider the role of the accountants character in presenting relevant and truthful information in financial reporting and the importance of practical reasoning in accounting. This article holds that rules, values and virtues are interconnected. This provides a sound (...) approach to ethics in accounting, in which character and practical reasoning are crucial. Consequently, ethical education in accounting has to simultaneously include the knowledge of proper rules and principles and their correct application; values (understood as moral goods) and virtues, whose acquisition, in the view of the author, should be encouraged. (shrink)

The integration of ethics into accounting curricula is a critical challenge facing accounting educators. The ethical subject matter to be covered and the role of the professor in ethical debates in the classroom are important unresolved issues. In this paper, we explore teaching basic values as an integral part of ethics education. Concern about indoctrination of students is addressed and the consistency of values education with the goals of ethics education is examined. A role for ethics researchers in identifying and (...) clarifying the basic values that define our profession is recommended, and suggestions for implementing values education in accounting ethics are provided. (shrink)

Measures of student ethical sensitivity and their increases help to answer questions such as whether accounting ethics should be taught at all. We investigate different sensitivity measures and alternatives to the well-established Defining Issues Test (DIT-2, Rest, J. R. et al. [1999, Postconventional Moral Thinking: A Neo-Kohlbergian Approach (Lawrence Erlbaum Associates, Mahwah, NJ]), frequently used to measure the effects of undergraduate accounting ethics education. Because the DIT measures cognitive development, which increases with age, the DIT scores for younger accounting students (...) are typically lower, have limited range, and are not likely to vary sufficiently with corresponding choices in ethical dilemmas. Since the DIT measures only the moral judgment component of ethical decision-making, we consider the multidimensional ethical scale (MES) to allow respondents to provide explanations for their moral and other judgments. The MES has been used to measure attitudes related to justice, utility, contractualism, egoism, and relativism. Unfortunately, the MES is not comparable in one-dimension to the DIT, and unlike the DIT, the MES has no theoretical or objective base. Therefore, we construct a comparable one-dimensional relative measure, a Composite MES Score, obtained from previous research on practicing accountants. We compare the reliability of this measure to the DIT in explaining the ethical choices of 54 specially chosen, somewhat homogeneous students, whose ages range from 18 to 19, and who are taking a second semester freshman accounting course at a private, religion-affiliated university. These particular students are relatively untrained in the formal use of questionable accounting choices. These students are less likely to recognize the dilemmas of the MES and are also less likely to demonstrate sufficient variation in their DIT scores, traditionally low for freshmen students. As freshmen, they are recent graduates of high school and more likely guided by other ethical influences including friends, family, or contractual obligations (some of the MES constructs) rather than higher cognitive development. This study confirms suspicions. We find the DIT scores do not vary sufficiently to explain the moral reasoning of freshmen. For eight dilemmas and 24 choices we find the DIT score correlates with only three choices, whereas the MES regression models have at least one significant construct for 23 out of 24 ethical choices. The Composite MES Score (a relative measure) also explains 23 out of 24 choices and is statistically related to the DIT in only one of the choices. Unlike the DIT, the Composite MES permits pretest and retesting with different dilemmas to evaluate changes in ethical sensitivity. These results argue for relative rather than absolute measures of sensitivity and guides beyond cognitive development (the DIT-score) to explain undergraduate student sensitivity. (shrink)

Although the AICPA Code of Professional Conduct emphasizes the importance of education in ethics, very little is known about how and when the Code and the topic of ethics can be presented to enhance the effectiveness of ethics-oriented education. The purpose of this research was to provide preliminary evidence about the ethical development of students prior to, and immediately following, such courses. We found that: (1) accounting students, after taking an auditing course which emphasized the AICPA Code, reasoned at higher (...) levels than students who had not taken the course; (2) there were no differences in moral reasoning levels when accounting and non-accounting majors were compared prior to an auditing course; and (3) there was a significant relationship between the Seniors' levels of ethical development and the choice of an ethical versus unethical action. It was concluded that an auditing course emphasizing the 'spirit' of the Code can have a positive impact on the ethical behaviour of some of the future members of the accounting profession. (shrink)

Calls for the expansion of ethics education in the business and accounting curricula have resulted in a variety of interventions including additional material on ethical cases, the code of conduct, and the development of new courses devoted to ethical development [Lampe, J.: 1996]. The issue of whether ethics should be taught has been addressed by many authors [see for example: Hanson, K. O.: 1987; Huss, H. F. and D. M. Patterson: 1993; Jones, T. M.: 1988–1989; Kerr, D. S. and L. (...) M. Smith : 1995; Loeb, S. E.: 1988; McDonald, G. M. and G. D. Donleavy: 1995]. The question addressed in this paper is not whether ethics should be taught but whether accounting students can reason more ethically after an intervention based on a discrete and dedicated course on accounting ethics. The findings in this paper indicate that a discrete intervention emphasising dilemma discussion has a positive and significant effect on students’ moral reasoning and development. The data collected from interviews suggest that the salient influences on moral judgement development include: learning theories of ethics particularly Kohlberg’s theory of cognitive moral reasoning and development; peer learning; and moral discourse. The implications from the findings in this study suggest that moral reasoning is responsive to particular types of ethics intervention and educators should carefully plan their attempts to foster moral judgement development. (shrink)

In this article we review the principal directions that an American Accounting Association committee has taken in the past three years to encourage the teaching of ethics in accounting programs and/or courses in higher education. We also (1) briefly comment on the place of accounting ethics in both higher education and continuing professional education and (2) provide some brief final comments.

This paper reports on a survey that investigated the moral decision processes of accountants. A formal belief revision model is adapted and hypotheses based on theorizations from the cognitive-developmental school are tested. The moral decision processes of accountants are hypothesized to be influenced by professional expectations, organizational expectations and internalized expectations. Subjects provided specific demographic data and were asked to access the appropriateness of fourteen principles for making moral decisions in business. Subjects were also asked to indicate which of the (...) fourteen approaches would be most appropriate for resolving each of five ethical situations that are representative of common ethical dilemmas in accounting.Subjects'' responses to the appropriateness of the fourteen principles are reduced to two dimensions using factor analysis. The factors are consistent and representative of important underlying dimensions of the stages of moral development. Demographic variables are correlated with the extracted factors using analysis of variance. (shrink)