Ethical Reasoning Instruction in Undergraduate Cost Accounting: A Non-Intrusive Approach

Abstract

ABSTRACT This article discusses a series of studies designed to yield statistically significant improvements in student moral reasoning when specific strategies and instructional materials were utilized in non-ethics undergraduate accounting and other business courses taught by instructors who were not formally trained in business ethics. The most recent research study reported in this article was conducted in an undergraduate Cost Accounting course. The results of the current study have yielded statistically significant increases in student moral reasoning as measured by the DIT-2, confirming the effectiveness of an intervention methodology. The specific intervention strategies and instructional materials utilized were developed through several iterations of developmental research studies that were carried out over a four-year period at a mid-sized Midwestern university. The measurement instrument of moral reasoning used in all of the research studies is the revised version of the Defining Issues Test, the DIT-2 (Rest, Narvaez, Bebeau & Thoma, 1999). Originally funded by a grant from the Lilly Endowment, the most recent study reported in this article was funded by a generous grant from the Delta Pi Epsilon Research Foundation, Inc. Keywords: accounting, accounting education, business schools, business ethics, ethical reasoning, teaching, moral development, decision-making model, designing a course, integrated curriculum, Defining Issues Test INTRODUCTION This article discusses a series of studies designed to yield statistically significant improvements in student moral reasoning when specific strategies and instructional materials were utilized in non-ethics undergraduate accounting and other business courses taught by instructors who were not formally trained in business ethics. The most recent research study reported in this article was conducted in an undergraduate Cost Accounting course. This study is one part of a larger set of confirmatory studies designed to corroborate results of previous research (Wilhelm, 2008) during the developmental phase for the intervention protocol. Control groups that were used in the previous studies (Wilhelm, 2008) served as proxy controls for the present study. Originally funded by a grant from the Lilly Endowment, the most recent study reported in this article was funded by a generous grant from the Delta Pi Epsilon Research Foundation, Inc. NEED FOR THE STUDY A profession such as accountancy is formed on the basis of (1) a generally accepted body of knowledge, (2) a widely recognized standard of education, and (3) a code of ethics (Smith & Smith, 2010). A code of ethics is a crucial element in guiding the behavior of a professional. The three major accounting professional organizations that have established a professional code of ethics are the American Institute of Certified Public Accountants (AICPA), the Institute of Management Accountants (IMA), and the Institute of Internal Auditors (IIA). The responsibilities that the three codes of ethics place on accountants and the related professional standards for each organization have many similarities. They all require professional competence, confidentiality, integrity, and objectivity. Accounting professionals should only undertake tasks that they can complete with professional competence, and they must carry out their responsibilities with sufficient care and diligence. Ethics in accounting has become even more important in light of the scandals at Enron, WorldCom, Tyco, Arthur Anderson, and others in the early 2000s. The Sarbanes-Oxley Act of 2002 is a reaction to these scandals. The act created the Public Company Accounting Oversight Board (PCAOB), and places greater responsibility on the company officers as to internal control and independent central oversight of public accounting firms that perform audit services. While business schools accredited by the Association to Advance Collegiate Schools of Business (AACSB) must meet ethics training expectations delineated by Assurance of Learning Standard 15: Management of Curricula (Eligibility Procedures, 2007), AACSB does not specify any courses or program template for delivering ethics and corporate social responsibility training to students. …

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