Developing and Measuring the Impact of an Accounting Ethics Course that is Based on the Moral Philosophy of Adam Smith

AbstractAccounting 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” (1790/1976), is effective in improving accounting student’s cognitive moral development (CMD). This research used a pre-test, treatment, post-test, quasi-experimental design utilizing the Defining Issues Test 2 (DIT-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.

[1]  Edmund L. Pincoffs.  Quandaries and Virtues: Against Reductivism in Ethics , 1986 .

[2]  D. Mccloskey.  Adam Smith, the Last of the Former Virtue Ethicists , 2008 .

[3]  A. C. Keller.  Smith versus Friedman: Markets and ethics , 2007 .

[4]  D. Raphael.  The impartial spectator : Adam Smith's moral philosophy , 2007 .

[5]  Steven Dellaportas,et al.  Making a Difference with a Discrete Course on Accounting Ethics , 2006 .

[6]  Toby L Schonfeld,et al.  Reflections on teaching health care ethics on the web , 2005, Science and engineering ethics.

[7]  James R. Rest.  Moral Development: Advances in Research and Theory , 1986 .

[8]  P. Werhane.  Business Ethics and the Origins of Contemporary Capitalism: Economics and Ethics in the Work of Adam Smith and Herbert Spencer , 2000, Issues in Business Ethics.

[9]  Christine E. Earley,et al.  A Note on Ethics Educational Interventions in an Undergraduate Auditing Course: Is there an ‘Enron’ Effect? , 2004 .

[10]  J. Bosch,et al.  STRENGTHENING MORAL COMPETENCE: A ‘TRAIN THE TRAINER’ COURSE ON MILITARY ETHICS , 2011 .

[11]  S. Mintz.  Aristotelian virtue and business ethics education , 1996 .

[12]  Scott K. Jones,et al.  An assessment of ethics instruction in accounting education , 1992 .

[13]  James Weber,et al.  Influencing Ethical Development: Exposing Students to the AICPA Code of Conduct , 1997 .

[14]  Irana J. Scott,et al.  Revitalizing Accounting Ethics Research in the Neo-Kohlbergian Framework: Putting the DIT into Perspective , 2010 .

[15]  S. Toulmin,et al.  The tyranny of principles. , 1981, The Hastings Center report.

[16]  Charles E. Harris,et al.  The Good Engineer: Giving Virtue its Due in Engineering Ethics , 2008, Sci. Eng. Ethics.

[17]  Tim Urdan,et al.  Statistics in Plain English , 2001 .

[18]  R. Hanley.  Adam Smith and the Character of Virtue , 2009 .

[19]  Robyn L. Jones,et al.  Sports coaching, virtue ethics and emulation , 2010 .

[20]  Steven M. Mintz,et al.  Virtue Ethics and Accounting Education , 1995 .

[21]  Annie Pullen-Sansfaçon.  Virtue Ethics for Social Work: A New Pedagogy for Practical Reasoning , 2010 .

[22]  Corporate Governance, Internal Decision Making, and the Invisible Hand , 2004 .

[23]  Steven M. Mintz.  Accounting ethics education: Integrating reflective learning and virtue ethics , 2006 .

[24]  Elaine N. Aron,et al.  Statistics for the Behavioral and Social Sciences: A Brief Course , 1996 .

[25]  William C. Crain,et al.  Theories of development: Concepts and applications, 2nd ed. , 1985 .

[26]  A Quasi-Experimental Study of Moral Reasoning of Undergraduate Business Students Using an Ethical Decision-Making Framework in a Basic Accounting Course. , 2006 .

[27]  Mary Beth Armstrong,et al.  Ethics and professionalism in accounting education: A sample course , 1993 .

[28]  William C. Crain,et al.  Theories of Development: Concepts and Applications , 1980 .

[29]  Daryl M. Guffey,et al.  Transitory or Persistent? The Effects of Classroom Ethics Interventions: A Longitudinal Study , 2009 .

[30]  Chuck Huff,et al.  Moral pedagogy and practical ethics , 2005, Science and engineering ethics.

[31]  James R. Rest.  Development in Judging Moral Issues , 1979 .

[32]  M. Collins,et al.  Nursing Theories: The Base for Professional Nursing Practice, second ed., Julia B. George. Prentice-Hall, Inc, Englewood Cliffs, NJ 07632 (1985), 354, $15.95 paperback. , 1987 .

[33]  James M. Wahlen,et al.  How Do Earnings Numbers Relate to Stock Returns? A Review of Classic Accounting Research with Updated Evidence , 2004 .

[34]  Peter Singer,et al.  A companion to ethics , 1993 .

[35]  Lawrence A. Ponemon.  Can ethics be taught in accounting , 1993 .

[36]  J. M. Cook,et al.  The Future of the Accounting Profession , 1993 .

[37]  S. Miller.  An Empirical Investigation Of The Impact Of The Sarbanes-Oxley Act Of 2002 On Agency Costs , 2010 .

[38]  A. R. Wyatt.  Accounting Professionalism—They Just Don't Get It! , 2004 .

[39]  Craig A. Mertler,et al.  Advanced and multivariate statistical methods: Practical application and interpretation: Sixth edition , 2001 .

[40]  M. Jennings.  Incorporating Ethics and Professionalism into Accounting Education and Research: A Discussion of the Voids and Advocacy for Training in Seminal Works in Business Ethics , 2004 .

[41]  J. Bessant.  Aristotle meets youth work: a case for virtue ethics , 2009 .

[42]  Lawrence A. Ponemon.  Ethical reasoning and selection-socialization in accounting , 1992 .

[43]  I. Kant,et al.  Fundamental Principles of the Metaphysic of Morals , 1981 .

[44]  C. Gastmans,et al.  Ethics in Nursing Education: Learning To Reflect On Care Practices , 2007, Nursing ethics.

[45]  Dawn W. Massey,et al.  Applying the Ignatian Pedagogical Paradigm to the Creation of an Accounting Ethics Course , 2010 .

[46]  B. Merino.  Financial Scandals: Another Clarion Call for Educational Reform— A Historical Perspective , 2006 .

[47]  Stephen J. Thoma,et al.  Alchemy and beyond: Indexing the Defining Issues Test. , 1997 .

[48]  Lynn E. Turner.  Learning from Accounting History: Will We Get It Right This Time? , 2006 .

[49]  J. Radden,et al.  Character virtues in psychiatric practice. , 2008, Harvard review of psychiatry.

[50]  L. Thorne,et al.  The Development of a Measure of Auditors’ Virtue , 2007 .

[51]  Brian W. Mayhew,et al.  The Impact of Ethics Education on Reporting Behavior , 2008 .

[52]  Stephen A. Zeff,et al.  How the U.S. Accounting Profession Got Where It Is Today: Part II , 2003 .

[53]  Jacob Cohen.  Statistical Power Analysis for the Behavioral Sciences , 1969, The SAGE Encyclopedia of Research Design.

[54]  Domènec Melé,et al.  Ethical Education in Accounting: Integrating Rules, Values and Virtues , 2005 .

[55]  Stephen J. Thoma,et al.  Postconventional Moral Thinking: A Neo-Kohlbergian Approach , 1999 .

[56]  L. Kohlberg,et al.  The Philosophy Of Moral Development , 1982 .

[57]  Irene N. McCarthy.  Professional Ethics Code Conflict Situations: Ethical and Value Orientation of Collegiate Accounting Students , 1997 .

[58]  M. Bebeau,et al.  The Defining Issues Test and the Four Component Model: Contributions to professional education , 2002, Journal of moral education.

[59]  D. Campbell,et al.  EXPERIMENTAL AND QUASI-EXPERIMENT Al DESIGNS FOR RESEARCH , 2012 .

[60]  D. Dimitrov,et al.  Pretest-posttest designs and measurement of change. , 2003, Work.

[61]  M. Armstrong.  Moral development and accounting education , 1987 .

[62]  James C. Lampe,et al.  Teaching Ethics in Accounting Curricula , 1994 .

[63]  Michael H. Sutton.  Financial Reporting at a Crossroads , 2002 .

[64]  James R. Davis,et al.  Promoting the moral development of accounting graduate students: an instructional design and assessment , 1994 .

[65]  Vicky Arnold,et al.  Behavioral accounting research : foundations and frontiers , 1997 .

[66]  Differences in Moral Reasoning Between College and University Business Majors and Non-Business Majors , 1996 .

[67]  R. M. Hutchins.  Great Books of the Western World , 1952 .

[68]  R. Hurtt,et al.  Implementing a Required Ethics Class for Students in Accounting: The Texas Experience , 2008 .

[69]  G. E. M. Anscombe,et al.  Modern Moral Philosophy , 1958, Philosophy.

[70]  Chaïm Perelman,et al.  Self-Evidence And Proof , 1958, Philosophy.

[71]  Lawrence A. Ponemon.  Ethical judgments in accounting: A cognitive-developmental perspective , 1990 .

[72]  Stuart Thomas.  Ethics and Accounting Education , 2012 .

[73]  Don A. Moore,et al.  Conflicts Of Interest And The Case Of Auditor Independence: Moral Seduction And Strategic Issue Cycling , 2006 .

[74]  Daniel B Wright,et al.  Comparing groups in a before-after design: when t test and ANCOVA produce different results. , 2006, The British journal of educational psychology.

[75]  Aristotle,et al.  THE NICOMACHEAN ETHICS , 1990 .