Accounting Ethics Courses: A Professional Necessity

By Bean, David F.; Bernardi, Richard A. | The CPA Journal, December 2005 | Go to article overview

Accounting Ethics Courses: A Professional Necessity


Bean, David F., Bernardi, Richard A., The CPA Journal


Fraudulent activities at Enron, WorldCom, HealthSouth, and other companies have had devastating effects on the financial markets and investors. Many senior citizens anticipating retirement have found their assets and dreams decimated. Many ask, "Where were the auditors and accountants who were supposedly protecting our interests?" When upper management "plays with the numbers," the public often assumes that the accountants and auditors act as willing and active participants in the process. Whether this is a fair assessment or not, the lack of ethics perceived by the public is a severe threat to the accounting profession.

Retaining or improving its previous level of trust and respect requires the profession to take proactive measures to restore its credibility. The National Association of State Boards of Accountancy (NASBA) is reviewing the comments received on its exposure draft for Rules 5-1, "Education Requirements-Definitions," and 5-2, "Education Requirements-Determining Compliance of the Applicant's Education." A major issue in the exposure draft is the requirement for ethics courses in accounting education. NASBA has received strong opposition from many academics. In the authors' view, practicing accountants should control the agenda on qualifications to become a CPA and should become active proponents of ethics education both in the initial education of those entering the profession and in continuing professional education. The views of the educational institutions and accounting faculty responsible for preparing students for entry into the accounting profession are not always the same as those of practicing professionals.

Institutions of Higher Education

The ubiquity of ethics in the mission statements of both universities and business schools requires greater scrutiny. Many college mission statements contain claims such as "Our graduates are ethical leaders in the business and community" and "We produce ethical decision makers." Yet only a handful of institutions require an ethics course as part of a student's liberal arts education, and few require a business ethics course. If ethics is a meaningful component of a school's mission statement, then it should be supported by the requirement of ethics courses in the curriculum

Accounting Academics

The most vocal opponents of the call for increased ethics education are committed proponents of the neoclassical economics paradigm, who seem to perceive ethics education as a threat to their conception of accounting. Many members of this group appear to be deeply offended by what they believe was a failure by NASBA to obtain their approval on the inclusion of ethics courses in the accounting curriculum; they are lobbying for a committee to study the matter before NASBA goes forward with an ethics requirement.

The authors' interpretation of this request for a committee is twofold. First, one must ask where these critics have been lately, because ethics is not a new or even recent concern to the profession. second, burying the issue of ethics education by forming a committee to ensure nothing will result is a political strategy.

Opponents of ethics courses in accounting have framed the debate in a manner that places an undue burden on the proponents of such ethics courses. The opponents demand proof that ethics courses result in a significant increase in the ethics of accountants or that ethics courses significantly improve the education of accountants. The issue should be recast to ask: "What courses are more important in a curriculum educating accountants than an accounting ethics course?" The burden of proof has been and continues to be misplaced; a fairer assessment is needed. NASBA's proposal of three ethics courses would represent nine credits in a 150-hour curriculum, or just 6%. …

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Accounting Ethics Courses: A Professional Necessity
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