Bakare (2007) reported that investors in Nigeria have lost several billions of dollars through the collusion of accountants and external auditors with companies’ management and directors to falsify and deliberately overstate companies’ accounts.
These collapses or systemic failures, as the broad range of financial scandals exposed in the early years of the 21st century have brought into sharp focus and over a more concentrated timescale, issues of long-standing debate (Brown, 2005) including: audit and accounting regulation; auditor independence; earnings management; and audit and audit firm quality controls.
One of the difficulties of evaluating the veracity of these claims, and the validity of the counter claims, is that moral scheme and codes of ethics have undergone changes over time. Prior research on ethics and the profession of accountancy has come from a wide range of disciplines and has focused on a broad range of issues.
It is widely acknowledged that the accounting profession is an important facet of our society (Wyatt, 2004).Accounting emerged from the society; Hines (1988) stated that accounting is socially constructed and socially constructing. This implies that accounting influences society and accounting is influenced by society. In the last decade, studies have shown that the accounting profession has had to deal with a lot of challenges than it has done in its lengthy history which spans over one Hundred years (Mactosh et al., 2010). This period has been characterized by series of business failures, ethical negligence and accounting scandals both in developed economies and developing economies. Publicized cases of the recent past, such as Satyam, Enron, WorldCom, Global Crossing, Adelphia Communications, HIH, Tyco, and Vivendi, Royal hold and HealthSouth together with a host of companies from Nigeria (such as, Cadbury and NAMPAK), have drawn increasing attention to the accounting profession. This has had a negative and cumulative impact on the way informed opinions view the accounting profession. There has been great apprehension regarding the fairness of the operation of a market system where shareholders, employees in general and pensioners have lost large sums, while those running companies, are seen as responsible for those losses, have enriched themselves as the businesses collapsed. In doubt if Nigerian related research efforts are adequate to fully address the challenges of enforcing ethical guidelines in financial reporting and auditing
EDITOR'S SOURCE: Latest Final Year Projects
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