How is the ethical behaviour of auditors quantified?

Main Article Content

Marta Tache

Abstract

“Government is going about reform the wrong way” is frequently encountered in the specialized literature which characterizes the synthesis of the present audit period. Although there exists an Ethical Code in the economic word, the practical controversy over the features of the accounting regulation to adjust the economic environment seems to be endless. The purpose of this paper is to analyse the ethical behaviour of auditors and its influence on the degree of audits’ independence, in view of the historical changes and the actual circumstances of the audit market. For this, the biggest financial frauds that have occurred in Europe and US between 1925 and 2020 together with the role of reforms in the audit world are investigated. The results indicate a solution which seems to be in the consciousness of human beings, in the moral law of people written in the Ethical Code and checked by supervisory bodies.

Downloads

Download data is not yet available.

Article Details

Section
Articles

References

Andow, J. (2018). Are Intuitions About Moral Relevance Susceptible to Framing Effects?. Review of Philosophy and Psychology, 1, 1–27.

Bardach, J., & Gleeson, K. (1999). Man Is Wolf to Man: Surviving the Gulag. University of California Press.

Barnes, J., Boardman, J., Griffin, J., & Murray, O. (1986). Hellenistic philosophy and science. The Oxford history of the classical world, 365-386.

Baxter, W. T. 1999. McKesson & Robbins: a milestone in auditing. Accounting, Business & Financial History, 9(2), 157-174.

Beasley, M. S., Buckless, F. A., Glover, S. M., & Prawitt, D. F. (2002). Auditing cases. Prentice Hall.

Beckett, A. E., & Campbell, T. (2015). The social model of disability as an oppositional device. Disability & Society, 30(2), 270-283.

Bratton, W. W. (2002). Enron and the Dark Side of Shareholder Value. Faculty Scholarship at Penn Law. 844.

Brennan, T. 2005. The Stoic Life. Oxford: Oxford University Press.

Brown, P., & Howieson, B. (1998). Capital markets research and accounting standard setting. Accounting & Finance, 38(1), 5-28.

Carcello, J. V., Hermanson, D. R., & Ye, Z. (2011). Corporate governance research in accounting and auditing: Insights, practice implications, and future research directions. Auditing: A Journal of Practice & Theory, 30(3), 1-31.

Chatfield, C. (1996). Model uncertainty and forecast accuracy. Journal of Forecasting, 15(7), 495-508.

Church, B. K., & Shefchik, L. B. (2012). PCAOB inspections and large accounting firms. Accounting Horizons, 26(1), 43-63.

Cremaschi, S. (2004). Ricardo and the Utilitarians. The European Journal of the History of Economic Thought, 11(3), 377-403.

Davis, D. R. (1998). Technology, unemployment, and relative wages in a global economy. European Economic Review, 42(9), 1613-1633.

DeFond, M. L. (2010). Earnings quality research: Advances, challenges and future research. Journal of Accounting and Economics, 50(2-3), 402-409.

Duska Ronald, F., & Shay, D. B. (2003). Accounting Ethics. Blackwell Publishing Ltd.

European Commision. (2011). Restoring confidence in financial statements: the European Commission aims at a higher quality, dynamic and open audit market.

European Commission. (2010). Audit policy: Lessons from the crisis. Green paper.

European Commission. (2011). Proposal for a directive of the European Parliament and of the Council: Amending directive 2006/43/EC on statutory audits of annual accounts and consolidated accounts.

Fine, G. (1999). Plato 2: Ethics, Politics, Religion, and the Soul.

Forbes. (2002). The corporate scandal sheets. 1-6.

Fried, C. (1978). Right and wrong. Harvard University Press.

Fung, Y. C., Tong, P., & Chen, X. (2017). Classical and computational solid mechanics. World Scientific Publishing Company.

Gay, G., & Pound, G. (1989). The role of the auditor in fraud detection and reporting. Company and Securities Law Journal, 7(2), 116-29.

Gert, B. (1967). Hobbes and psychological egoism. Journal of the History of Ideas, 28(4). 503-520.

Griffiths, I. (1986). Creative Accounting: How to Make your Profits What you Want Them to be. Sidgwick & Jackson, London.

Gunny, K. A., & Zhang, T. C. (2013). PCAOB inspection reports and audit quality. Journal of Accounting and Public Policy, 32(2), 136-160.

Guthrie, W. K. C. (1971). The Sophists. Cambridge: Cambridge University Press.

Harvey, J. B. (1988). The Abilene Paradox and Other Meditations on Management. Lexington, Mass: Lexington Books.

Hill, J. L. (1995). Mill Freud, and Skinner: The Concept of the Self and the Moral Psychology of Liberty. Seton Hall L.

Howieson, B. (2005). Can we teach auditors and accountants to be more ethically competent and publicly accountable? Ethics and Auditing, 265.

IFAC. (2016). An Overview of NOCLAR: Q&A with IESBA Chairman Dr. Stavros Thomadakis

International Federation of Accountants, & International Ethics Standards Board for Accountants. (2010). Code of ethics for professional accountants. International Federation of Accountants.

Irvine, W. (2008). A Guide to the Good Life: The Ancient Art of Stoic Joy. Oxford University Press.

IS Chartered Accountant Journal. 2015. An interview with dr. Stavros Thomadakis, 26-29.

Kant, I. (1953). Immanuel Kant's critique of pure reason. Рипол Классик.

Kant, I. (1993). Groundwork of the Metaphysic of Morals.

Levitt Jr, A. (1998). The numbers game. The CPA Journal, 68(12), 14.

Libby, T., & Thorne, L. (2004). Auditors' virtue: a qualitative analysis and categorization.

Lucas, N. (2004). An Interview with United States Senator Paul S. Sarbanes. Journal of Leadership & Organizational Studies, 11(1), 3-8.

McBarnet, D., & Whelan, C. (1999). Challenging the regulators: Strategies for resisting control. Regulation and Deregulation: Policy and Practice in the Utilities and Financial Services Industries, 67-78.

McNamee, M. J., & Fleming, S. (2007). Ethics audits and corporate governance: The case of public sector sports organizations. Journal of Business Ethics, 73(4), 425-437.

Mill, J. S. (1961). The Philosophy of John Stuart Mill: ethical, political, and religious.

Norris, P. (2011). Democratic deficit: Critical citizens revisited. Cambridge University Press.

Nowak, G. T., & Liang, S. S. (2003). Putting Audit Committee Reform in Its Historical Context: Revolution or Evolution? Corporate Counsel, 7-8.

Nowak, G. T., & Liang, S. S. (2003). Putting Audit Committee Reform In Its Historical Context: Revolution Or Evolution?. Corporate Counsel, 7-8.

Olson, J. (2017). Two Kinds of Ethical Intuitionism: Brentano’s and Reid’s. The Monist, 100 (1), 106-119.

Paik, Y., Lee, J. M., & Pak, Y. S. (2019). Convergence in international business ethics? A comparative study of ethical philosophies, thinking style, and ethical decision-making between US and Korean managers. Journal of Business Ethics, 156(3), 839-855.

Palmer, L. E., & Erford, B. T. (2012). Predicting Student Outcome Measures Using the ASCA National Model Program Audit. Professional Counselor, 2(2), 152-159.

Peecher, M. E., Solomon, I., & Trotman, K. T. (2013). An accountability framework for financial statement auditors and related research questions. Accounting, Organisations and Society, 38(8), 596-620.

Pesch, H. (2003). Ethics and the national economy. Gates of Vienna Books.

Roberson, D. B. (2018). Pottery, Poverty, & Probity: Fictilis and the ‘Simple Life’ in Seneca and Juvenal.

Robertson, D. (2018). Stoicism and the Art of Happiness. Great Britain: John Murray.

Rosen, S. (1983). Plato's 'Sophist', The Drama of Original and Image. Yale University Press, New Haven.

Sarbanes, P. (2002). Sarbanes-Oxley act of 2002. In the Public Company Accounting Reform and Investor Protection Act. Washington DC: US Congress.

Sharav, I. (2003). If Sarbanes-Oxley is to work, be wary of certain offers. Accounting Today, 17(10), 6.

Shroff, N. (2017). Corporate investment and changes in GAAP. Review of Accounting Studies, 22(1), 1-63.

Simnett, R., & Smith, A. (2005). Public oversight: An international approach to auditing. Ethics and auditing, 45.

Smith, A. (1937). The wealth of nations.

Sprague, R. K. (1972). The Older Sophists: A Complete Translation by Several Hands. Columbia SC: University of South Carolina Press.

Taylor, S. E. (1983). Adjustment to threatening events: A theory of cognitive adaptation. American psychologist, 38(11), 1161.

Thompson, I. H. (1998). Environmental ethics and the development of landscape architectural theory. Landscape Research, 23(2), 175-194.

United States Congress Senate Committ. (2019). Banking and Currency: Hearings Before the Committee on Banking and Currency, United States Senate, Sixty-third Congress, First SessionUnited States.

Walker, M. U. (1991). Moral luck and the virtues of impure agency. Metaphilosophy, 22(1), 14-27.

Wall Street Journal. (2000). Lernout & Hauspie surges in Korea, raising questions.

Westermark, H., Fournier, J., & Renaud-Solari, L. (2016). Regulation of Audit and Audit Supervision, European Union, France, Germany. available on www.isdc.ch.