Accounting Professionals' Perceptions of Ethics Education: Evidence from Turkey

Uyar, Ali; Güngörmüş, Ali Haydar Article Accounting Professionals' Perceptions of Ethics Education: Evidence from Turkey Journal of Accounting and Management Information Systems (JAMIS) Provided in Cooperation with: The Bucharest University of Economic Studies Suggested Citation: Uyar, Ali; Güngörmüş, Ali Haydar (2013) : Accounting Professionals' Perceptions of Ethics Education: Evidence from Turkey, Journal of Accounting and Management Information Systems (JAMIS), ISSN 2559-6004, Bucharest University of Economic Studies, Bucharest, Vol. 12, Iss. 1, pp. 61-75 This Version is available at: https://hdl.handle.net/10419/310514 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. 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If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. http://creativecommons.org/licenses/by/4.0/ Accounting and Management Information Systems Vol. 12, No. 1, pp. 61–75, 2013 ACCOUNTING PROFESSIONALS’ PERCEPTIONS OF ETHICS EDUCATION: EVIDENCE FROM TURKEY Ali UYAR 1 and Ali Haydar GÜNGÖRMÜŞ Fatih University, Istanbul, Turkey ABSTRACT The purpose of this study is to investigate accounting professionals’ perceptions of (1) importance of education phases and environmental conditions in development of ethics awareness, (2) approaches in accounting ethics education in university and professional pre-qualification, and (3) coverage of accounting ethics education. Data was collected from public accountants via an online questionnaire during November and December, 2011. The questionnaire was developed based on a review of earlier studies. A total of 219 accountants replied to the survey. The findings demonstrated that most of the respondents (i.e. practicing accountants) have not taken ethics education previously. Secondly, the results provided evidence that all stages of education life, ranging from kindergarten to university, are important and contribute to the development of ethics awareness. Environmental factors are also important in the development of ethics awareness. Giving ethics as a stand-alone course is considered the most appropriate approach in teaching ethics. Responses indicated that “auditing” is the most and only course in which ethics should be taught. Moreover, the respondents approved the inclusion of ethics within various stages of the certified accountancy curriculum. Accounting, accountant, ethics, education, Turkey. 1 Corresponding author: Ali Uyar, Adress: Fatih University, 34500, Büyükçekmece, Istanbul, Turkey, Tel: +90 212 8663300, Ext: 5042; Fax: +90 212 8663342, E-mail addresses: [email protected]  Accounting and Management Information Systems Vol. 12, No. 1 62 INTRODUCTION Accounting education has been considered technical in nature (Gunz & McCutcheon, 1998). However, emergence of corporate scandals raised the question of “how much are ethical issues covered in accounting education?”. Acting professionally requires more than technical knowledge. For example, professional bodies and business organizations, which realize the importance of ethics, establish codes of ethical behavior to guide and support individuals in ethical decisionmaking (Prodhan, 1998). However, these codes will not be sufficient for individuals to behave ethically. It needs to be supported by moral development and thought of others. Therefore, designing courses for enhancing moral reasoning is relevant in ethics education (Prodhan, 1998). Ethics in business practice has attracted a renewed interest in the wake of the corporate scandals of the 1990s and early 2000s (Duarte, 2008). After those infamous corporate scandals arising from misdeeds of accountants and executives, ethics-related research has gained momentum. One of the streams of these works is the education of ethics in business and accounting schools, because ethics education is expected to reduce the level of fraud in the business world by integrating ethics into accounting programs (Caliyurt & Crowther, 2006). Earlier studies have been conducted on various samples, such as students, public accountants, academics or various combinations of them since they represent different facets of the subject. However, there some unanswered questions such as “which education phase is the most important in shaping ethical awareness of a person?”, “how ethics should be taught in university?”, “which subjects should ethics education cover?”, and “In which stage of Certified Public Accountancy internship, professional ethics should be considered?”. This study aims at answering these questions taking into consideration gender, education level, experience, and job title of the respondents. The remainder of the paper is structured as follows. In the next section, a literature review is provided. In the third section, scope and methodology is presented. In the fourth section, results are analyzed. In the last section, concluding comments are provided. 1. LITERATURE REVIEW There are various issues regarding ethics education within accounting such as giving it as a stand-alone course or integrating it with other accounting courses, its content and coverage, targeted goals, methods employed, and so on. Unlike the technical part of accounting education, teaching ethics in business schools seem to be away from structured coverage, methods, and so on. “Whose responsibility is ethics education?” is also one of the basic questions about ethics education. For Accounting professionals’ perceptions of ethics education: evidence from Turkey Vol. 12, No. 1 63 example, family, religious groups, school, university, business, profession are possible answers to the question (Bampton & Cowton, 2002). Actually, ethical issues penetrate all veins of the life. Thus, people continuously face ethical dilemmas in personal life and work life. Therefore, it cannot be squeezed to one point of education life; rather it should be dispersed over various stages of education life. Proponents of ethics education argue that it has a positive effect on students’ ethical attitude, whereas some others argue that ethics cannot be taught. Bean and Bernardi (2007) state that ethics education is essential for certified public accountants, and it must be learned either at college level or professional level ethics courses in accounting. Before all, recognition of the importance of ethics education in business and accounting schools by both faculty members and students is the first step in achieving the targeted goals. Adkins and Radke (2004) provided empirical evidence that students perceive ethics education in accounting courses to be more important than faculty members do. In an Australian study, the great majority of survey respondents, who were students, expressed the view that ‘‘it is important for future managers’’ to study ethics, and also felt that they had benefited from studying ethics in undergraduate management subjects (Duarte, 2008). Bampton and Cowton (2002) state that the question of “what place should ethics have in the curriculum?” is one of the basic issues regarding ethics education. There has been much debate on the subject in scholarly publications. Dellaportas (2006) indicated that a discrete course dedicated to accounting ethics education can be designed. Gunz and McCutcheon (1998) argue that ethics can be integrated into other courses rather than taught as a separate course. However, they contend that this approach might affect the commitment of instructors as the coverage depends on their will. Moreover, Richards et al. (2002) point out that finding sufficient time and space within curriculum in business schools is not easy since the business environment undergoes periodic changes and expansion which requires the addition of some topics. Thus, addition of a course may lead to cutting some other courses. A survey conducted on chairpersons of accounting departments in the US indicated that ethics received the most coverage in auditing course rather than other accounting courses (Cohen & Pant, 1989). In the relevant literature, there are examples of two approaches; teaching ethics in accounting as a stand-alone course (Dellaportas, 2006) or integrating it within other accounting courses (Sims, 2000; Molyneaux, 2004). Dellaportas (2006) designed a discrete course in an Australian University entitled Ethical Issues in Accountancy (see course outline in Dellaportas, 2006, p. 396). He proved that the discrete accounting course emphasizing dilemma discussion has a positive and significant effect on students’ moral reasoning and development. Following another approach, Accounting and Management Information Systems Vol. 12, No. 1 64 Sims (2000) explains how the business faculty at Nova Southeastern University instituted an Ethics Across the Curriculum Policy step-by-step. The business faculty’s commitment to ensure that students learn ethical issues are relevant in every business field is stated in policy statement for course syllabi. The policy requires the incorporation of ethics formally within objectives of various business courses, and inclusion of student assignments and classroom activities on the course syllabi. Other universities might adopt similar approach following the guidelines in the article (Table 1). Similarly, Dunfee and Robertson (1988) provide guidance how a business ethics course can be incorporated into key MBA courses based on a project implemented in The Wharton School. They show the inclusion of ethics topics into a sample of courses in detail. Table 1. Steps in developing Ethics across the Curriculum Policy step 1 faculty agreement that business ethics is important step 2 faculty agreement that universities should teach business ethics step 3 faculty agreement that they should be the ones who teach business ethics step 4 faculty share how they currently handle business ethics within their courses step 5 ask for volunteers to formalize the teaching of business ethics within their courses step 6 write an ethics across the curriculum policy statement step 7 provide faculty support Source: Sims (2000: 441) Prodhan (1998) succinctly states that the purpose of ethics education is to help people resolve ethical dilemmas. Felton and Sims (2005) explain very well what the targeted goals of teaching ethics should be. They suggest and provide examples of ten goals and in brief these are (Felton & Sims, 2005): Students should understand their core values at the end of the course, since it is a prerequisite for ethical decision-making, It should broaden students’ understanding of ethics and its complexities, since it goes beyond simplistic view of what is right and wrong, Students should realize that ethics is embedded in all business decisionmaking rather than an isolated discipline, It should broaden students’ cultural perspectives as ethics reflects cultural values, Students should be aware of expanding number of stakeholders rather than just investors and learn to take into consideration their interests, Students should learn to consider the consequences of a managerial decision-making for next generations, It should enhance the comfort levels of students to discuss ethical issues in managerial and other settings, It should increase students’ awareness of ethical and leadership accountabilities as managers such as exercising power responsibly and judiciously, Accounting professionals’ perceptions of ethics education: evidence from Turkey Vol. 12, No. 1 65 It should develop an awareness within students that accountable managers need to expand their ethical sensitivities and accountabilities continuously across time, Students should be encouraged to understand the corporate cultures and values of companies when searching for jobs. There are several suggested pedagogical approaches to achieve the abovementioned targeted goals. McPhail (2001) suggests various methods that can be employed to develop an ethics program and a moral sensitivity towards others for accounting students such as group learning, real life case studies, role play, film, literature, and personal value journals. He further emphasizes the importance of interdisciplinarity about content of the course and composition of the class. However, regardless of the method implemented, the commitment of faculty members is very important in achieving desired result. Moreover, there are some obstacles in front of ethics education in accounting. Limited material or in sufficient coverage of the subject within accounting textbooks (Bampton & Cowton, 2002), unwillingness of some academics to handle the subject, insufficiency of expert in the field, and not believing in benefits of ethics education might be among them. 2. METHODOLOGY The questionnaire was developed based on a review of earlier studies, and put on the World Wide Web. Data was collected during November and December, 2011. A total of 219 accountants replied to the survey. This paper covers the analyses of seven questions from the questionnaire, some of which were modified from previous studies (Bampton & Cowton, 2002; Cohen & Pant, 1989; Caliyurt, 2007). Thus, seven sections of the questionnaire were structured to answer the following research questions: RQ1: Whether respondents have received accounting ethics education? RQ2: How important are education phases (i.e. kindergarten, secondary, high school, university) in the development of ethics awareness? RQ3: How important are environmental conditions (i.e. family, peers, education life, and work environment) in the development of ethics awareness? RQ4: How ethics education in accounting should be delivered to the students in university? RQ5: Which topics should accounting ethics course cover? RQ6: In which course should accounting ethics be taught? RQ7: How ethics education can be integrated into internship stage which is the initial stage of professional development? Accounting and Management Information Systems Vol. 12, No. 1 66 3. ANALYSES AND RESULTS 3.1 Demographic background As in every survey questionnaire, we asked demographic questions to the respondents regarding respondents’ gender, job title, income level, education, and experience. Out of 219 respondents, 179 are male and 40 are female. Furthermore, 124 respondents have experience of less than or equal to 10 years, the remaining 95 have more than 10 years. Most of the respondents are graduates of faculty, or holders of master degree or PhD. Majority of the responding accountants earn between 1,000-3,000 TL a month. The highest percentage in job title belongs to Certified Public Accountants (48.4 percent). The detailed statistics for all demographic properties are given in Table 2. Table 2. Demographic background Frequency Percent I. Gender Female 40 18.3 Male 179 81.7 Total 219 100.0 II. Experience 1-5 years 62 28.3 6-10 years 62 28.3 11-15 years 41 18.7 16-20 years 23 10.5 Over 20 years 31 14.2 Total 219 100.0 III. Education High school 9 4.1 2-year college 13 5.9 Faculty 144 65.8 Master degree/PhD 53 24.2 Total 219 100.0 IV. Title Intern 66 30.1 Independent Accountant 14 6.4 Certified Public Accountant (CPA) 106 48.4 Sworn-in Certified Public Accountant (SCPA) 6 2.7 No title 27 12.3 Total 219 100.0 Accounting professionals’ perceptions of ethics education: evidence from Turkey Vol. 12, No. 1 67 Frequency Percent V. Income level Less than 1.000 TL* 11 5.0 1.000-3000 TL 134 61.2 3000-5000TL 48 21.9 5000-10.000TL 24 11.0 Over 10.000 TL 2 0.9 Total 219 100.0 VI. Cities İstanbul 128 58.4 Bursa 26 11.9 Ankara 15 6.8 Kayseri 13 5.9 Kütahya 5 2.3 Others (Less than 5) 32 14.6 Total 219 100.0 * Turkish liras Have you received accounting ethics education? Initially, the respondents were asked whether they have received ethics education previously. 73 accountants answered “yes” to this question, whereas the remaining 146 answered “no”. We have checked whether males or females are more educated in terms of ethics; however the results did not show much difference. Those who are educated are twice as much as those who are not in both genders. Table 3 presents cross-tabulation of accountants who received accounting ethics education or not. In all titles, those who have received accounting ethics education are no more than those who have not. Table 3. Have you received accounting ethics education? No title Intern IA CPA SCPA Total Have you received accounting ethics education? Yes 7 21 3 39 3 73 No 20 45 11 67 3 146 Total 27 14 66 106 6 219 Importance of education phases in the development of ethics awareness We asked respondents to evaluate the importance of education phases in the development of ethics awareness based on a 5-point Likert scale of 1 (not important) to 5 (very important) (Table 4). Responses regarding four primary stages of education life, secondary school received the highest ranking (mean=4.55), followed by high school (mean=4.44), preschool (mean=4.39), and university (4.25). First of all, these means tell us that all stages of education life are important and contribute to the development of ethics awareness certainly. Accounting and Management Information Systems Vol. 12, No. 1 68 However, comparison of means of items put forward that early and late education stages are relatively less important than the others. This might be due to the fact that children are too small to understand the ethical principles in their early lives. On the contrary, it may be too late to shape ethics awareness of a person in the university. Thus, ethics education should not be the concern of only university life, but also the concern of secondary and high school stages. In those stages, at least some of basic concepts can be taught to the students by using various tools such as media. Bampton and Cowton (2002) also found that school has the second highest responsibility in ethics education after family, but before university. Table 4. Importance of education phases in the development of ethics awareness Mean Std. Dev. Rank Preschool (kindergarten) 4.39 0.944 3 Secondary school 4.55 0.773 1 High school 4.44 0.657 2 University 4.25 0.891 4 Importance of environmental conditions in the development of ethics awareness We asked respondents to evaluate the importance of four environmental factors that shape the development of ethics awareness based on a 5-point Likert scale of 1 (not important) to 5 (very important) (Table 5). Responses indicated that family life plays a key role (mean=4.72) since an individual’s personality is shaped within family primarily by behaviors of parents. If parents set a good example for children, they are likely to mimic them in every situation. This finding corroborates Bean and Bernardi (2007) which states the importance of parental instructions in formation of personal values and ethical behaviors. Secondly, peers are considered very important as well (mean=4.47). Thirdly, education life after family is very important since children are spending years within schools. Curriculum, teachers, and social activities can raise ethical values of children to a higher point. Work environment is also important, because sometimes, environment pressure employees to behave unethically, such as managers and work conditions. A study conducted on university academics in British Isles also proved that family has the highest responsibility in ethics education followed by profession, school, university, business, and religious groups (Bampton & Cowton, 2002). Table 5. Importance of environmental conditions in the development of ethics awareness Mean Std. Dev. Rank Family life 4.72 0.568 1 Peers 4.47 0.699 2 Education life 4.43 0.722 3 Work environment 4.39 0.813 4 Accounting professionals’ perceptions of ethics education: evidence from Turkey Vol. 12, No. 1 75 Cohen, J. R. & Pant, L. W. (1989) “Accounting educators’ perceptions of ethics in the curriculum”, Issues in Accounting Education, vol. 4(1): 70-81 Dellaportas, S. (2006) “Making a difference with a discrete course on accounting ethics”, Journal of Business Ethics, vol. 65: 391-404 Duarte, F. (2008) “What we learn today is how we behave tomorrow”: a study on students' perceptions of ethics in management education”, Social Responsibility Journal, vol. 4(1/2): 120-128 Dunfee, T. W. & Robertson, D.C. (1988) “Integrating Ethics into the Business School Curriculum”, Journal of Business Ethics, vol. 7: 847-859 Felton, E. L. & Sims, R. R. (2005) “Teaching business ethics: targeted outputs”, Journal of Business Ethics, vol. 60: 377-391 Gunz, S. & McCutcheon, J. (1998) “Are academics committed to accounting ethics education?”, Journal of Business Ethics, vol. 17: 1145-1154 Jackling, B., Cooper, B.J., Leung, P. & Dellaportas, S. (2007) “Professional accounting bodies’ perceptions of ethical issues, causes of ethical failure and ethics education”, Managerial Auditing Journal, vol. 22(9): 928-944 McPhail, K. 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