Accounting Educators and Practitioners' Perspectives on Fraud and Forensic Topics in the Accounting Curriculum
Daniels, Bobbie W., Ellis, Yvonne, Gupta, R. D., Journal of Legal, Ethical and Regulatory Issues
Preventing and detecting fraud in organizations continue to be problematic for the accounting profession based on the number of reported fraud cases and statistics. It is estimated that a typical organization loses five percent of its annual revenue to fraud; therefore, organizations in the United States loose approximately $994 billion to fraud each year (ACEF, 2010) and based on the 2011 Gross World Product (GWP) this translates to a potential fraud loss of more than $3.5 trillion (ACEF, 2012). Given the magnitude of fraud problems and the frequency to which auditors are associated with fraud; one might expect that most accounting curricula would include fraud training. However, this is not the case (Peterson, 2003, 263). As a result, investors, regulators and other stakeholders are concerned with the failure of accountants to detect fraud in organizations. Consequently, business schools have received much of the blame for the lack of education and training of accountants to detect fraud. Albrecht et al. (2009) noted three failures by educators that contributed to the large number of financial statement frauds during the years 2000-2002. First, educators had not provided sufficient ethics training to students, therefore many students were not equipped to deal with ethical dilemmas. Second, educators were not teaching students about fraud; therefore, the majority of students do not understand the elements of fraud, perceived pressures and opportunities (1). A third educator failure is the way accounting and business students are taught. Effective accounting education must focus less on teaching content as an end unto itself and instead use content as a context for helping students develop analytical skills.
Many business schools have responded by redesigning the accounting curriculum to include fraud courses and programs to help prevent and detect fraud (Fletcher, Higgins, Mooney, and Buckhoff 2008). However, the results of a study by Meier, Ravindra, and Yihong (2010) show that AASCB accredited schools have been slow in adopting programs and courses in forensic accounting and fraud examination. Due to financial constraints, many business schools may not be able to add new courses or programs to the accounting curriculum. Thus, implementing fraud and forensic topics into existing courses maybe the only solution for many business schools. The purpose of this paper is to assist educators and administrators in selecting the most relevant fraud and forensic topics to include in the accounting curriculum. We surveyed 500 accounting educators and 500 accounting practitioners on their perceptions regarding fraud and forensic topics to include in the accounting curriculum. After reviewing the relevant accounting literature along with forensic and fraud textbooks, we selected 21 topics to include in the curriculum to help students prevent and detect financial statement fraud. The responses were scored on a five-point Likert scale ranging from a score of "1" indicating unimportant to a score of "5" indicating very important. The results from the both the full and partitioned samples show that both groups selected internal control as the number topic. The partitioned sample between educators and practitioners identified nine significant differences in the mean scores. Overall, the results show that both groups perceived the coverage of fraud and forensic topics in the accounting curriculum to be very important. The results of this study can assist educators and administrators in the selection process of fraud and forensic topics to include in the accounting curriculum.
The remainder of the paper is organized as follows. The next section provides a discussion of relevant literature. The third section discusses the methodology used to gather and analyze the data. The fourth section provides a discussion of the results. The final section includes the summary and conclusion along with limitations and opportunities for future research. …