Melbourne Institute of Technology - MA619 Accounting Research Report

This report, titled "Accounting Research," delves into the critical importance of teaching accounting ethics to students. It begins with an introduction to ethical principles and their significance in the accounting profession, emphasizing the need for accountants to possess an ethical mindset. The literature review explores the existing research on accounting ethics education, highlighting the potential for promoting ethical awareness and decision-making among students, while addressing past ethical issues and scandals. The report then defines accounting ethics and its role in upholding good practices and professionalism, discussing the impact of ethical codes on accountants' conduct and the need for transparency and accurate financial reporting. It examines the impact of ethics on society, emphasizing the consequences of unethical behavior, such as damage to reputation, increased fraud, and compromised decision-making. The report concludes by underscoring the importance of teaching accounting ethics, arguing that it prepares students to make ethical decisions in the business world and addresses the growing need for ethical standards in the face of recent accounting scandals. The report examines the educational methods and importance of teaching accounting ethics to students.

Running Head: ACCOUNTING RESEARCH
ACCOUNTING RESEARCH
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction................................................................................................................................2
Literature Review.......................................................................................................................2
Accounting Ethics..................................................................................................................3
Impact of Ethics in the Accounting on Society......................................................................5
Education of Ethics in Accounting........................................................................................5
Importance of Teaching Accounting Ethics...........................................................................6
Conclusion................................................................................................................................11
Reference..................................................................................................................................13

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Introduction
The possessing of the ethical mindset generally involves the consistent practice of the
principles of the ethics, which needs to train to the students for possessing the mindset of
acting ethically. Accounting ethical codes are considered as the fundamental principles,
which are chosen by the accounting professionals for abiding it, in order to enhance their
professionalism, maintain the public trust as well as demonstrating fairness and honesty.
Ethics often referred as the set of belief or the code of conduct that helps in dictating fair,
unfair as well as right and wrong. The professional of accounting is based on the ethics and
morals. It is extremely important to have proper ethics as well as ethical behavior due to
number of reasons, any unethical activity potentially harm the business for all the accounting
firms. Hence, under this research paper, analysis will be done on importance of teaching
accounting ethics for accounting students.
Literature Review
The education of ethics to the accounting students has been suggested as the
alternative for promoting the ethical awareness as well as decision-making and it is
considered as the kind of the essential remedy to the worse practices of the accounting. The
effectiveness of the ethical education in the accounting has now becomes the guidelines for
the several studies by pointing out the mixed results in relation to improve the moral
reasoning of the students. However, there are numerous issues of ethics in the past such as
accounting fraud, scandals, effectiveness of teaching and so on that has aroused the need for
teaching accounting ethics to the accounting students. It brings out the set of the conditions,
which accompany the student from childhood and which influences their behavior. Therefore,
this research would contribute to advancement of the empirical knowledge on subject because

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by intervening the variables, the attitudes of the students can be influenced and avoiding the
future deviations of the conduct from the professional accountant (Guragai et al. 2015).
The first cultivation of the ethical orientation is at home and it is later influenced by
the surrounding community standards and the peers, the improper behaviors of the others can
be undermined it in the context of business. The student generally comes to the university
with their certain behavior pattern that is ingrained in them. Therefore, training should be
given to them for working ethically or even more ethically, in case if there are partially
developed ethical orientations. This helps in resisting the influences of the other’s unethical
behavior, when they are at their work. In the accounting, honesty as well as integrity plays
the important role. It is because it helps in allowing the investors for trusting the information
received by them about the companies in which they do the investment (Anzeh and Abed,
2015). Honesty in the accounting is one of the primary feature of their professions, which
allows the financial decision makers for making the appropriate judgements. The accountant
should know what is right and what is wrong and they should always displays in their
accounting as well as bookkeeping activities. Moreover, they are obligated for protecting the
information from the public releases or the unauthorized disclosure. Financial accounting
ethics generally forms the basis of the requirements of the legal as well as regulatory and it
includes the issues that are related to maintain the trust of public. It has been found that the
students who are with the high positive scores on the ethical test may also behave unethically,
even if they have been exposed to the education of ethics as well as have attained the higher-
stage development in the models of ethical assessment (Shawver& Miller, 2017).
Accounting Ethics
The main driver of the accounting ethics as well as ethical values is to uphold the
good practices as well as professionalism. In many organizations, around the world, the major
ethical issue in the process of the accounting is the potential for the conflict of interest. The

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breaching of the ethical rules in corporate financial reporting practice is not fair to the users
and these actions would jeopardize the key objectives of financial reports. Ethics is defined as
the discipline in which the examination is done regarding right or wrong as well as good or
bad methodically. Ethics generally looks at the behavior of the accounting, moral principles
as well as attempts for distinguishing between good from bad. In order to identify the
common issues that are dealt within the environment of the business, the code of the ethics of
the professional bodies plays the important role (Warhurst, 2019). These are the codes helps
in representing that what should be considered to the business ethics reflection. The code of
ethics helps in addressing the particularities of the high activities of the risk and it is built on
the professions collective conscience, which is the proof for the acknowledgement of the
group moral dimension. The dimension of ethics helps in providing the foundation, under
which there exist civilized society. The standards of ethics acts as compass, which directs as
well as monitors the people’s action for achievingtrue and the fair practices (Mintz, 2016). In
the case of accounting profession, the code of ethics establishes the standards for the behavior
of the accounting professionals as well as it displays the fundamental principles, which
should be respected for fulfilling the common objectives. There is strong influence of the
ethical code of accounting on the accountant conducts. The accountant has greatest impacts
on their accounting professionals conduct such as companies rules and policies where
accountant usually work as well as religion (Bukola& Augustine, 2013).
The current business world as well as the current information age requires that the
professions of accounting should uphold the transparency as well as provide the accurate
financial reporting. Hence, the accountants who are responsible for producing the accurate,
concise as well as timely financial reports should uphold highest standard of the ethical
responsibility. It is found that there is strong mutual interdependence that exists in between
accounting professionals and the accountant role (Ramadhan, 2015).

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Impact of Ethics in the Accounting on Society
The ethics requires that the financial statement accounting should aim for making it
useful for the end users to ease their processes of financial decision-making. The society of
the business expects the accounting professionals for adhering to the ethical standards as well
as ensuring the accurate, timely and transparent information, which is presented to all the
end-users. If the business attempts for deliberately constructing the false financial statements
then it could severely damages the business organizations reputation and it lead towards
increased fraud activities, damages reputation of the business and limits the usefulness of the
financial statements. If the accountant of the company makes the poor ethical considerations
then it minimizes the oversight level as well as superiors control that creates loopholes for the
auditors for engaging in the unethical behavior as well as concealing the evidences (Sorensen,
Miller &Cabe, 2017). Moreover, it creates the opportunities for the significant manipulations
of the data by leading to serious crimes commitments such as fraud and evasion of tax. The
reputation as well as trustworthiness of the organization is also affected by the accounting
professional unethical activities. Hence, the business losses trust because of conducting
unethical practices, their identity may taints that make it difficult for them for conducting the
business. Further, accountants’ unethical behaviors are considered violations of the
regulations. It is because they are doing manipulation in the financial statements. As the
consequence of which, these financial statements have less or no legal status, which greatly
affects the process of decision-making (Cheng & Chu, 2014).
Education of Ethics in Accounting
The education of ethics is considered as most important aspect in the professionals’
development. There is need for teaching accounting ethics to the accounting students because
it helps the student in preparing them to be professionals with having the capacity for making
the ethical decision-making in business world. One of the major challenges of the educational

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institutions particularly in respect of the courses ofbusiness oriented is for enhancing the
students with the moral values because technical skills are not sufficient in the current
business environments. There is the need for much broader as well as deeper education of
ethics in comparison with the differentiating between right and wrong because environment
changes over time and the personal values also changes. The accounting student should have
good ethical reasoning and understanding (Shawver& Miller, 2017). The education of ethics
in the accounting should encompasses simultaneously encompasses the knowledge about the
values, virtues and norms as well as principles. Hence, the education in accounting aims for
humanizing the students as well as generating the moral commitments of the future
accountants in front of the society. The students who studied or have studied accounting
ethics have demonstrated ethical attitudes. The ethical attitudes is generally linked with
higher or lower accounting fraud, it is because subjects equate the local legal as well as
ethical standards with ethical conduct guide and its uses for the business decision-making.
The academic institution generally employs different methods as well as places different
levels of the emphasis on the teaching of the ethics during the degree of accountancy (Pierce,
2019).
Importance of Teaching Accounting Ethics
In the business world of today, adhering higher standards of the ethical behavior has
increasingly become more important. It has been observed that hardly any day goes out
without having the news regarding unethical practices by the business organizations. The
ethical standard of the business is in question. Therefore, the academics of accounting are
charged up with the responsibility for educating the managers as well as accountants of
future. It does not enables to be good at only technical skills of accounting rather it also helps
in enabling to be good citizens of corporate, which is paramount responsibility of them.
Moreover, accounting is that career field in which the most important traits of character for

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the individuals are morals as well as ethics. If the accounting ethics are applied poorly then it
could lead the companies towards bankruptcy from any type of fraudulent activities or
misstatements or improper reporting of the financial information. Ethics are considered as
one of the important aspects of the accounting profession. It is the branch of the philosophy,
which helps in systematizing, recommending as well as defending the conduct, which is right
or wrong for the organization. Hence, imparting the knowledge of ethics to the student would
be helpful to make them aware regarding different aspects if it so that they could apply it
within their accounting profession in future(O'Leary, 2009).
The growing scandals of accounting in the recent years such as WorldCom, Enron and
so on in the different parts of the country has increased the need of teaching ethics to the
accounting ethics. These scandals have involved egregious failures by the accounting firms or
the individual accountants. It has been found that the faculty of accounting are relatively
unmoved by the recent scandals of the corporate. In this context, the ethical crisis is not the
new thing and it would not be addressed by the education of ethics (Jonson, McGuire &
O’Neill, 2015). This particular view ignores that the scandals are because of the failures of
audit standards and procedures failure. There are different ways for addressing this attitude
that includes more positive support for the teaching ethics, rethinking of the culture of
business school as well as more interaction with the stakeholders in the business. It shows
that there is more negative outcome, which points out the viewpoint of self-satisfaction from
the faculty members as well as more positive support from the students for the ethics (André
Feil, Diehl & Schuck, 2019).
The traditional lectures are now replaced by the activities as well as constant exposure
to the ethical situations of real-life, which the graduate accountant may face in the real
situation. This method of teaching generally has the positive effect on the changing attitudes
of the students about the behavior of the ethics. The universities in general like to see their

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students to have strong awareness of the issues of ethics as well as understanding of vital role
that they would be in exercising of the professional skills as well as responsibilities. Some of
the degrees of the university have the semester long courses that are devoted to ethics
teaching (Ibidunni et al. 2019).
There is number of models that have been devised as the framework for teaching as
well as learning of the ethics. In the Ethics development model, there are four levels by which
the ethics teaching and research can be accessed that are level 1, level 2, level 3 and level 4.
The level 1 considers the understanding of persona ethics as the foundation of every action.
In the early life of person, they are highly occupied with the attributes such as right or wrong,
fair and unfair, respect and integrity as well as so on, which is very difficult to change.
Hence, this framework of this level suggests that the attributes can be taught. Moreover, at
the Level 2, the student can be helped in translating the personal values of ethics into the
business setting with the help of the forcing them for forcing different dilemmas of
ethics(Loeb, 2015). Level 3 suggests that whenever someone is facing the ethical situation
them there should be conviction for taking the stand in spite of the cost associated with it.
The last Level 4 helps in representing the ethical leadership that instills in others, the desires
for developing the ethical courage as well as awareness. The educators have generally
contributed towards the ethical breakdown of the accountants because realistic ethical
situation have not been exposed to them. Moreover, they have proposed for not teaching the
content as the means to the end but instead of it using the content as context to help the
students for developing the skills (Liu & Hu, 2012).
Recently, the Ethics Education Toolkit has been developed by the International
federation of accountants that is based on the framework of ethics education and is based on
the objective of encouraging as well as assisting the accounting educators. Under this
particular framework, the education of ethics is leveled up in the hierarchical order that

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comprises of behavior, knowledge, judgment and sensitivity. The knowledge as well as
sensitivity is gained with the help of this framework in the pre-qualification education and
while the student needs for making the ongoing commitments to the ethical behavior as well
as practices in the post qualification educations as well as continuing development programs
(Martinov-Bennie & Mladenovic, 2015).
In the branch of accounting discipline, accounting ethics is the complicated aspect. It
aims for helping the professionals in the process of decision-making, which includes the
moral dilemmas. It helps in supporting the concepts of conventional accounting, while
helping the professionals for making the decisions. In the accounting discipline, ethics helps
in focusing the long-term business in comparison with the short-term effectiveness of the
performance of the business (Dellaportas et al. 2014). It is because of the complication of the
ethics, it needs to be implemented at each stages of the education of accounting.
Implementation of the ethics helps enhancing the awareness of the students towards the
ethics. The main objective behind the teaching ethics is to teach the students for identifying
the ethical issues as well as the way of handling these issues within the organization as well
as acquainting the students with the techniques of decision-making. The teacher generally
uses the methods of lectures, teamwork and case studies. However, students learn more
precisely with the help of real situation of life for understanding the consequences of non-
obedience of the ethical codes (Cameron & O'Leary, 2015).
Barriers in Teaching Ethics
The greatest challenges that are faced by the professionals of accounting is
maintaining of the exemplary standards of the ethics. Hence, there is greatest challenge for
the academics of the accounting for getting the ethical messages, all across the students of
accounting, who are the practitioners of tomorrow. Accounting is the field, under which high

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levels of morals as well as ethics are important. Ethics, in the accounting, is considered as
the important aspects as it helps in representing the traits that are displayed by the individuals
who prepares the financial statements. Ethics plays important role in the accounting
procession because it helps in dealing with the hard data, facts and figures. In order to take
financial decisions, stakeholders generally rely upon the prepared financial information.
Hence, students are taught regarding how to provide accurate, competent as well as unbiased
information (Martinov-Bennie & Mladenovic, 2015).
However, there are certain barriers in teaching ethics to the students. Generally, it has
been observed that an academician lacks the enthusiasm for teaching the ethics. It is because
the hours of the teaching are not suitable or enough to include ethics in curriculum.
Moreover, it has been also observed that there has been major objection regarding imparting
ethics education to the accounting student. It is because the critic views accounting as
objective criteria and according to them there is no need for imparting ethics education as for
governing accounting professional, there are ethical code of conducts as well as legal
frameworks governing the company and professionals (Das, 2015).
Implications for teaching Ethics
If ethics has been taught to the students then it would have positive impact to the
student and if they are not being taught ethics, then there might be the negative consequences
of it to the students. Classroom participation is having generally positive impact on the
development of the appreciation as well as understanding of the history of the accounting. It
is because of the interaction of the different viewpoints of the students during the class
discussions. This helps in providing the broader perspectives and helps in providing the
appreciation as well as understanding of complicated issues that are presented into the class.
Ethical behavior helps in reflecting both the individual as well as situational influence as the

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professional accountants are generally induced for acting ethically with the help of two
aspects of the socialization that is their education as well as their influence of their work
places or the influence of peer and the work places.
There are number of implications, if ethics are not being taught to the students. This
can be explained with the help of example. If the student becomes the accounting
professional then they may indulge in the unethical practice by doing manipulations in the
accounting figure. Hence, on one hand he will be doing so by thinking he is doing good for
the company and taking his regular salary, but he does not know how majorly it will affect
him as well as the company. If the company is caught doing unethical practices by the
government may become bankrupt and the accounting professions will losses his job. Hence,
if this could be taught in the classroom itself regarding distinction between ethical and
unethical practices as well as its potential implications in to the students then the negative
implications can be reduced (Das, 2015).
Conclusion
Therefore, it is concluded from the analysis that the greatest challenge faced by the
profession of accounting is to maintain the exemplary standards of ethics. It therefore,
follows greatest challenge for the academics of the accounting for how getting the ethical
message across the students of accountancy, who will be practicing it tomorrow. There is the
great call for incorporating the ethics into the curriculum of the accounting, which now have
widespread the world in early years of 21st century. Further, it has been analyzed that there
are many benefits of teaching. If the students are trained in the fields of the ethics then would
get benefit from the exposure to the life cases such as manipulations of accounting,
fraudulent activities, avoidance of tax and so on. In addition, it is analyzed from the analysis
that the issues of ethics in the accounting practices is of crucial importance. There are various
aspects of the accounting that requires honesty as well as integrity of the accountants that

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starts with the phase of the organizations of the accounting system then to the preparations of
the financial statements and lastly to delivering of the data for the purposes of the
management. Right from the collapse of the Enron in the year 2002 has depicted the
weaknesses of the accounting practices. Therefore, the accounting students should be trained
and taught effectively by the teacher so that they would identify as well as addresses the
ethical issues. Moreover, with the help of imparting education of the accounting ethics and
employing the ranges of the techniques of imparting ethical instruction would be able to
positively impact the ethical attitudes of accounting students. Further, it has been analyzed
that the ethical attitudes is influenced by the factor of education. Hence, teacher should be
attentive in contemplating the courses of accounting and the ethics. The accountants should
pay attention to the good ethical conduct as well as they should strictly adhere to ethical code
of conduct. However, there are few questions that arises from the analysis that whether the
teaching the students on the accounting ethics is successful or not and whether the student is
applying they learning in the real life situations while working in the real business
environment? This needs to be assessed in further studies.

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