GROUP 1 SUMMARY

The aftermath of the implosion of Enron and Worldcom were among those of the known
high-profile corporate scandals that greatly wreaked more chaos on the accounting profession
than in any other case. Their downfalls were primarily brought by individual and collective greed
and corporate arrogance. There were many motives and attitudes behind their decisions which
led to their eventual failure. Their financial scandals were brought by their problems and thus
alarmed for the need of improvement of ethical standards, financial management, and other
regimes. The accounting profession has the considerable responsibility towards these areas of
business, and thus any weakness or deficiency would lead to scandals and collapses that would
greatly damage the economy and society primarily because it concerns the general public.
Because of all the sensational issues, researches were made and the findings from the accounting
literature presents a disturbing possibility that accounting education has a more negative impact
on students ethical predispositions than a positive one. Among those researches, it was specially
concluded that accountants exhibit lower levels of moral reasoning and; accounting students are
less ethical as they go through their education and dont even recognize the social responsibility
in relation to professionalism. In short, most accounting students think that accounting is an
amoral and technical activity. This contemporary issue has led to a debate about the extent to
which the accounting educations contribute towards or against the accountants ethical
development.
The accounting profession also has its growing interest. There are major socio-cultural
shift in the way people relate to each other, to professions, and professionals. People, nowadays,
are having diminishing trust between individuals and do not simply accept what the authority has
to say because there has been a shift to a more deliberative democracy a partnership role. These
socio-cultural shifts have substantial consequences in the accounting professions. Furthermore,
aside from this, there is a broader societal shift brought by the increasing commercialization of
accounting practice. As a result, together with greater litigation, consolidation of accounting
firms and the merger of accounting and law firms occur (Roberts, 2001). This process therefore,
has a deep and profound impact on the mentality of accounting firms.
Furthermore, aside from the predispositions of accountants and uneasiness in the
accounting profession, the function of accounting within society has a growing critical reflection.
Customarily, businesses were simpler than it is today. It was basically to make money. However,
as years pass by, there is already a shift in public attitude towards businesses. There were already
the occurrences of new corporate social responsibility reporting and sustainability discourses.
The emergence of social and environmental accounting gave rise to substantial challenges in the
responsibility of accountants and accounting practice. Now, the concern enters when big
businesses come with more complex organizations and nature. Globalization, financial
engineering, cross-cultural issues are some features of the new context of businesses today
against which the public is now more concerned. There has been an increase in technical
complexity which now challenges the competence of accountants as it requires sufficient
knowledge in its field.
Nevertheless, because of all the increase in ethical awareness, growing pervasiveness and
complexity of businesses, and the growing importance of accounting, the ethical resources have
been weakened as suggested by many moral philosophers. More than that, there is a lack of
ethical competence to face many ethical issues. Simply stated, the accountants in themselves are
ethically illiterate. Although there are existing sources as to the basis of ethics, like religious
institutions and belief systems, the emergence of this new cultural shift has driven more moral
confusion. Moral obligations are straightforward. It is easy to identify and fulfill since they are
within the bounds of a culture. There is an awareness of how to apply these moral codes and are
fully aware of how their actions affect their relationships with other individuals. However, these
conditions, as MacIntyre argued, do not apply in the modern era; that is why the moral confusion
now spread because the moral code weakened. Thus, this diffusion of moral confusion has
significant effects on the ethics of accounting. Its implications are not only on how accountants
would feel when confronted by a dilemma but also the narrative and institutional work in making
accounting just.
In light of the fact on how accounting is becoming more complicated and an increase in
their awareness, there is still a lack of public and political engagement with the ethics of
accounting and this awareness does not extend with anything. Traditional resources have
diminished and there is a growing concern as to the lack of ethical capacity in the accounting
profession. Accountants and practitioners seem to lack the competencies in the professional code
and the ethical skills to help them understand the set of rights and values it promotes. However,
it should be emphasized that it is not on how accountants lack good behavior, but more on their
ability to ethically analyze within a broader organizational and political or economic context.