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MOSAIC Conference, University of Konstanz, 27-31 July 2009. Ethics to Accountants: Challenges of a Global Qualification Devendra Kodwani, ACCA and Open University, UK Marcia Schillinger, University of Education Weingarten, Germany. Presentation plan. Introduction and aims

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Mosaic conference university of konstanz 27 31 july 2009

MOSAIC Conference,University of Konstanz, 27-31 July 2009

Ethics to Accountants:

Challenges of a Global Qualification

Devendra Kodwani,

ACCA and Open University, UK

Marcia Schillinger,

University of Education Weingarten, Germany

Presentation plan
Presentation plan

  • Introduction and aims

  • ACCA’s approach to ethics/moral judgment competence

  • The Moral Judgment Test (MJT, Lind)

  • Accounting Judgement Exercise (AJE)

  • Analysis of AJE responses

  • Conclusions, questions, way forward

Introduction and aims
Introduction and aims

  • Accounting profession and importance of ethics and moral judgment competence

  • Primary aims are:

    • Describe ACCA’s approach to ethics/moral competence

    • Discuss the results from AJE

    • Raise questions for future research

Accounting profession and importance of ethics
Accounting profession and importance of ethics

  • Role of accountants in society

    • They produce accounting reports (communication about economic conditions of firm, economy, and other organisation)

    • Doctors/pathologists of financial condition of any organisation (they sign the health and death certificates for organisations)

    • Accountants are gate keepers between the producers of information and users of information

The association of chartered certified accountants acca
The Association of Chartered Certified Accountants (ACCA):

Some facts:

  • Global qualification - 72% of ACCA members and students are based outside the UK

  • In over 170 countries ACCA students sit the same exams and achieve the same qualification

  • ACCA has 362,000 students and 131,500 members, with a network of 82 offices and centres across the world

  • Accountants for business - 60% of ACCA members work in the corporate sector

  • Benefit to the profession - ACCA has 57 global accountancy partnerships around the world

  • Over the past year, more than 210,000 students registered for examinations online

Acca s approach to sensitize students to ethical and moral issues
ACCA’s approach to sensitize students to ethical and moral issues

  • To gain ACCA qualification comprises:

    • 14 written exams

    • minimum three years of relevant professional experience, and

    • a Professional Ethics Module.

Acca s approach to ethics and moral competence
ACCA’s approach to ethics and moral competence issues

  • The ethics is integrated through the examined components in varying degrees.

  • The ethics content is examined in range of papers but one of the compulsory papers at Professional level called Professional Accountant specifically examines ethical and professional dilemmas through realistic case studies and discursive questions.

  • ACCA requires all the students to go through an Ethics Module which is done by students online.

Ethics module and integration of ethics
Ethics Module and Integration of Ethics issues

Although the Module is not formally examined in a paper, its completion is compulsory and its content has direct relevance for most Professional level examinations in particular to Professional papers on Corporate Governance and Ethics and Audit and Assurance.

Acca five ethical principles
ACCA Five Ethical Principles issues

  • integrity,

  • objectivity,

  • professional competence

  • due care,

  • Confidentiality and professional behaviour

  • ACCA Rulebook contains the full text of these principles. ACCA emphasise legal compliance in different jurisdictions as well as compliance with ACCA fundamental principles for all its students, affiliates and members as it notes in the module, “as a human being, you and your ethics are shaped by your upbringing and your experience. As a professional accountant or student accountant, you are bound by the laws of your country, and all regulations that flow out of them. As an ACCA member, student, or affiliate, you are also bound by the fundamental principles of ACCA.” ACCA Professional Ethics Module.

Development of the accountant s dilemma
Development of the accountant‘s dilemma issues

  • Based on the MJT methodology.

  • Related to accountant`s work life.

  • Two validation studies with ACCA students

    • MJT and Accountant dilemma (AJE)

      • 1st. Part (June, 2007); N = 320

      • 2nd. Part (Sept. 2008); N =200

      • Online survey (worldwide)

Moral judgement competence by age groups
Moral judgement competence by age groups issues

N = 318; age (mean) = 33,4.

Mjt c score by working experience
MJT C-score by working experience issues

Working experience or age alone are not responsible for fostering moral judgment competence.

Statistically significant inverse correlation between years of working experience and levels of moral judgment competence.

Accounting dilemma
Accounting Dilemma issues

As a professional accountant, Jane faces a difficult situation. She has found out that her highly regarded manager, who had always supported her and has consistently acted with integrity, has been involved in suspicious activity. Jane discovered that he had created a series of small fictitious payables accounts within the purchase ledger, all of which remain wholly unsettled. She knows that she ought to report any irregularities. Yet, this could lead to the dismissal of her manager, ending a very promising accounting career. When checking the accounts again, she discovers that the ‘fictitious’ accounts have suddenly disappeared. After thinking it over, she decides to keep all this information to herself.

Accoutant s dilemma cont
Accoutant’s Dilemma (cont.) issues

  • Students are then asked to choose the level of agreement or disagreement with Jane’s decisions on a 7 point scale with -3 as Strongly Disagree to 3 as Strongly Agree.

  • Students are then presented 6 arguments each Pro and Contra and are asked to choose on a 8 point scale to indicate whether each argument is accepted or rejected.

  • As a complement to the AJE, students are then asked to give their opinion about the nature of the problem: legal, personal, economic, ethical or political

Accounting judgement exercise
Accounting Judgement Exercise issues

  • The accountant dilemma did not fulfil the validation criteria.

  • However, ACCA chose to use AJE in their module because the main objective of AJE as part of Ethics Module was to sensitize students to moral dilemmas faced in accounting context.

    Ethics Module as it appears to students:

Analysis of aje responses
Analysis of AJE responses issues

  • Responses to AJE from 200 students are analysed

  • Students’ agreement or disagreement with Jane.

    • participants showed little sympathy with the decision of the actor in the dilemma-story (Jane). This might indicate that they do not conceive the story as a dilemma at all. Actually, more than 80% of the respondents said they disagree with Jane

Accountant s dilemma ajt opinion on how the dilemma was solved
Accountant´s dilemma (AJT) issuesOpinion on how the dilemma was solved

I strongly disagree

I strongly agree

Analysis of qualitative responses
Analysis of qualitative responses issues

  • Out of 200 students whose AJE responses were analysed, 133 provided feedback on the question: What have you learned from this module?

Analysis of qualitative responses1
Analysis of qualitative responses issues

  • A preliminary analysis of these responses shows that following few themes are recognised by the students:

    • Integration of ethics across curriculum

    • Ethics goes beyond laws and reinforces ‘public interest’ role for accountant

    • Many factors influence ethical behaviour (age, gender, country)

    • Ethics can be taught, framework for dealing with dilemma. Do they expect ready answers?

Conclusion issues

  • The analysis of responses to AJE shows that students prefer stage 4 andreject other higher or lower stages.

  • However, nearly 80% of students showing disagreement with Jane’s decision suggests that AJE does not seem to generate the moral conflict as would be expected from other MJT studies.

Conclusion issues

  • Literature review (not presented here) shows that there is growing need to bring ethical dilemmas into the accounting and business educational programmes

  • Global association of accounting bodies IFAC, has formally required all its affiliate bodies to ensure ethics is taught and assessed in their qualifications

  • Given the nature and scale of ACCA qualification ACCA needed to find a practical and effective way of integrating ethics in its qualification.

  • Initial response from the students to Ethics Module and Professional Accountant papers suggest that students appreciate this opportunity to engage with moral dilemmas in non-threatening academic setting provided by ACCA exams and assessment.

Acca accounting qualification an overview of professional educational framework
ACCA Accounting Qualification: An Overview of Professional Educational Framework

Design Syllabus








for exams


Writes exam

Professional Experience

Ethics Module

Conduct Exam

Quality Control

Online Ethics Module

Professional accountant paper
Professional Accountant Paper Educational Framework