Home
Shop

We can buy from other sites for you 

09036857618

Description

THIS RESEARCH WRITING IS ON ETHICS AND ACCOUNTING PRACTICE IN NIGERIA.

ABSTRACT

The broad objective of the study is to examine the impact of ethics on accounting practice in Nigeria. The specific objectives was to examine if ethics improves accounting practices, if corporate governance improves compliance with ethical standards and if accounting regulatory bodies affects ethical standards. The survey research design was used for the study with an extensive reliance on primary data. The populations of the study consist of accountants, auditors and management of selected companies. A sample of 147 respondents was utilized for the study. The likert scale questionnaire was used as the research instrument and chi-square parametric was utilized as the data analysis method. The findings indicate that firstly, ethics play a significant role in accounting practice. Secondly corporate governance improves ethical compliance of accounting professionals and thirdly, accounting regulatory bodies influences the level of compliance with ethical standards. The recommendation is that there is a need for ethical standards in accounting practice to extend beyond mere documentation and articulation to effective enforcement of these standards and the concerted efforts by all stakeholders ranging from the accounting professionals, top management of companies, regulatory bodies, government and indeed all users of accounting services is essential in ensuring the sustenance of the campaign for ethicality in accounting practice.

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

In recent times, studies such as (Armstrong, 2008 and Leuz & Barth 2008) have all cited evidence of the clamor for improvements in financial reporting and credibility of financial statements. Fundamentally, the agitation tends to favour migration of local accounting standards to achieve convergence with international standards. This is based largely on expectations that international standards would lead to higher disclosure levels, credibility and improvement in the informativeness of financial reports (Miller and Bradshaw, 2008). However, Ball (2005) opines that standardization of accounting rules is just one of the elements of the on-going requirements which will tend towards accounting professionalism and improvement in reporting standards. Consequently, the roles of ethics in accounting practice have received considerable attention from several studies (Ryan, 2005). This is against the backdrop that cases of corporate failure have been attributed amongst other factors to unethical practices of accounting professionals (Sanusi, 2010; Ryan, 2005). This implies that the functions of the accounting professional as it relates to the accuracy and correctness of accounting records amongst others, is pertinent to the sustainability of the entity.

Furthermore, the importance of maintaining proper accounting records is reflected in the likelihood that the some error and inaccuracies in the accounting records may influence the financial statements. Consequently, this has implications beyond the sphere of the reporting entity to the multiplicity of users of accounting information. According to Hale (2005) following major corporate failures and questionable accounting practices at the beginning of the 21st century, the reputation and ethical values of the accounting profession was tarnished, thus affecting considerably the value relevance of accounting estimates reported in financial statements. Studies such as Tigos and Keefe (2004) have also recognized the role of ethics and ethical issues in accounting practice and corporate failure.

Ethics as a concept is replete with different definitions since the concept is often viewed from different perspective.

According Hanekom (1984) the question of ethics is one that is linked with the history of mankind. Ethics deals with the character and conduct and morals of human beings. It deals with good or bad, right or wrong behaviour; it evaluates conduct against some absolute criteria and puts negative or positive values on it. Conversely, Miner (2002) defined ethics as right or wrong actions that stems from the value and expectation of society. Furthermore, Mintz and Morris (2007) notes that ethics are acceptable standards of behaviour that define how people ought to act (i.e. prescriptive) not how people really act (i.e. descriptive). Consequently, a code of ethics outlines a set of fundamental principles. These principles can be used both as the basis for operational requirements (things one must do) and operational prohibitions (things one must not do). It is founded on a set of core principles or values. Those subject to the code are expected to understand, internalize, and apply the examples in situations the code does not specifically address.

The effect of ethics and ethical issues on accounting practice cuts across developed and developing economies. In Nigeria, according to Sanusi (2010) fundamental to the issues of corporate failure witnessed in the banking system was the unethical practices of the corporate structure of these institutions of which the accounting system framework is not exclusive. Consequently, this study attempts to present an overview of the issues and implications of ethics vis-à-vis the accounting practice in Nigeria.

STATEMENT OF THE RESEARCH PROBLEM.

The Sarbanes-Oxley Act was passed in 2002 to correct amongst other things ethical issues in corporate governance and strengthen accounting practice by promoting transparent financial reporting, discouraging earning manipulation, fraud and falsification of accounting records. Though passed in the united states of American, the contents and issues addressed in the act are either presently existing challenges or foreseeable challenges for developing countries like Nigeria. According to Egwuonwu (2007), there is a long list of corporate casualties across international and national divides on account of variance from ethical standards. In Nigeria alone 54 banks have either failed or forced to close shop between 1994 and 2005. Then there were the cases of the then Lever Brothers Nigeria Plc and Cadbury Nigeria Plc who overstated their earnings through the cooking of accounts. However, when we ask the question “who are behind these figures”, we are ultimately exploring to reveal the behavioral quality of the Accountants and their management collaborators who have authored and endorsed the accounts or financial statements presented to the organization. No such financial statements can be reliable if the behavioral accountability of those behind them is not reliable. However, there are few studies in Nigeria that have evaluated the issue of ethics and its implications on the accounting practice in Nigeria. This has created a gap in the stock of knowledge and hence the need and relevance of a study of this nature.

RELEVANT RESEARCH QUESTIONS

In the light of the above the research questions are;

Do ethics play a significant role in accounting practice?

Does corporate governance improve ethical compliance of accounting professionals?

To what extent do regulatory bodies influence compliance with ethical standard in accounting practice?

RESEARCH OBJECTIVE

The main objective of this study is to examine the impact of ethics on accounting practices in Nigeria. The specific objectives are to:

Determine if ethics play a significant role in accounting practice.

Evaluate if corporate governance improves ethical compliance of accounting professionals.

Examine the role of regulatory bodies in the development and enforcement of accounting ethics.

1.5RESEARCH HYPOTHESIS

The following hypothesis was formulated for this study;

H0: Ethics do not play a significant role in accounting practice.

H1: Ethics plays a significant role in accounting practice.

H0: Corporate governance does not improve ethical compliance of accounting professionals.

H1: Corporate governance improves ethical compliance of accounting professionals.

H0: Accounting regulatory bodies do not affect compliance with ethical standards.

H1: Accounting regulatory bodies affects compliance with ethical standards.

1.6SCOPE OF THE STUDY

This study Ethics and the accounting profession is restricted to the Nigerian environment. Consequently, it is based on a random sample size of 200 respondents, consisting of professional accountants, top management staffs and users of accounting information. Questionnaires would be used to generate the required information needed to test the hypotheses formulated.

1.7 SIGNIFICANCE OF THE STUDY

It is expected that this study would consolidate existing literature on the issues around ethics and the accounting profession. Furthermore, the outcome of this study would aid policy makers and regulatory bodies in the formulation of policies to enhance the accounting profession. More so, it is expected that this study would provide the required theoretical framework needed to revitalize the accounting curriculum of undergraduates t incorporate the consideration of more ethical issues. Finally, it is also expected that the results of this study would provide motivation for further studies.

WE CAN GET ANY MATERIAL FOR YOU

Do you want a project Material different from this, Contact us

Reviews

There are no reviews yet.

Be the first to review “ETHICS AND ACCOUNTING PRACTICE IN NIGERIA”

Your email address will not be published. Required fields are marked *

Back to Top
Product has been added to your cart
×