Accounting report
Esmaeil Khoshbakht; Amirhossein Taebi naghandari
Abstract
The present study aims to investigate the effect of religious beliefs on the inaccuracy of accountants in preparing financial statements, with a focus on the mediating role of professional ethics in Iran. For this purpose, 400 questionnaires were designed and distributed among official accounting and ...
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The present study aims to investigate the effect of religious beliefs on the inaccuracy of accountants in preparing financial statements, with a focus on the mediating role of professional ethics in Iran. For this purpose, 400 questionnaires were designed and distributed among official accounting and auditing professionals. The data was analyzed using Amos software. The findings indicate that religious beliefs have a negative and significant effect on accountants’ dishonesty and a positive and significant effect on their professional ethics. Additionally, the professional ethics of accountants is a factor that reduces inaccuracies in preparing financial statements, exerting a negative and significant effect. Finally, as a mediating variable, professional ethics explains the relationship between religious beliefs and accountants' dishonesty. The findings confirm that professional ethics serves as a partial mediator in this relationship.IntroductionFraud and inaccuracies in financial reporting have drawn significant attention in the accounting and auditing professions, particularly regarding their causes and the methods available to prevent fraudulent behavior. The inaccuracy of accountants is a multi-dimensional and complex phenomenon with various causes and effects, often leading to destructive consequences for business units and society.Increasing levels of inaccuracy in financial reporting have resulted in the bankruptcy of both large and small companies, raising concerns about the quality of financial statements. Consequently, identifying opportunities and possibilities to address accountants' inaccuracies in financial statements has become a key focus for creditors, investors, consultants, legislators, accountants, and other stakeholders.The expansion of morality and religiosity can often be more effective than laws, regulations, and standards in preventing inaccuracies. Accountants and auditors primarily follow laws and standards imposed by regulatory bodies such as the standards development committee and the auditing organization. However, these externally imposed standards may not always be fully accepted or embraced wholeheartedly. In contrast, religious and moral principles such as honesty and truthfulness are deeply rooted in personal beliefs. These principles often stem from family upbringing and are influenced by factors such as schooling, religion, and public or cultural institutions, which are deeply intertwined with native and natural structures. As a result, there is a stronger likelihood that auditors and accountants will adhere to religious and moral principles compared to externally imposed standards.Literature ReviewThe relationship between religiosity and religious beliefs can be analyzed through the theory of social norms. Social norm theory suggests that social norms influence people's behavior. It predicts that the religious beliefs of managers are shaped by the religious norms prevalent in their local geographical area. The importance of social and religious norms within a society plays a significant role in fostering people's adherence to these norms. By emphasizing the overall importance of moral behavior, faith-based beliefs provide specific guidelines and equip adherents with a framework for describing and understanding moral or immoral experiences.MethodologyThis research is one of the few studies that utilize the scientific method of construction and experimental proof, conducted based on pre-determined research hypotheses and plans. This type of research is appropriate when the data measurement criteria are quantitative, and statistical techniques are employed to extract results. Additionally, since the data for this study is collected through a questionnaire, it can be classified as survey research. In terms of its purpose, it falls within the applied research category.In this study, all official accounting and auditing justice experts working at the provincial centers across the country were considered as the statistical population. Using Cochran's formula, the sample size for the study was determined to be 385 individuals. To ensure caution, 400 questionnaires were distributed among the members of the statistical population. Given the existing limitations, the questionnaire was administered online through the Judiciary Research Center. Out of the respondents, 325 individuals completed the questionnaire, and the number of valid responses suitable for analysis was 312. It should be noted that 13 questionnaires were excluded due to incomplete information. Therefore, the total number of questionnaires used for statistical analysis in this study was 312.ResultsFigure 1 illustrates the regression coefficients and the paths related to the testing of research hypotheses. The variable of faith-based beliefs is considered an independent variable, the inaccuracy of accountants in financial reporting is the dependent variable, and professional ethics is the mediating variable. Path c represents the relationship between the independent and dependent variables in the absence of a mediating variable. Path a shows the relationship between the independent variable and the mediator, while path b indicates the relationship between the mediator and dependent variables. Additionally, path c' represents the relationship between the independent and dependent variables in the presence of the mediating variable. To test the research hypotheses in Amos software, three mediation models, the direct model and the indirect model were employed. These models were included in the present study, and the related findings were reported. The findings revealed that religious beliefs have a negative and significant effect on accountants’ dishonesty and a positive and significant effect on their professional ethics. Furthermore, the professional ethics of accountants, similar to religious beliefs, is a factor that reduces the inaccuracy of accountants in preparing financial statements and has a negative and significant effect on it. Finally, as a mediating variable, professional ethics explains the relationship between religious beliefs and accountants' dishonesty. The findings confirm that professional ethics is a partial mediator in this relationship.DiscussionThis research demonstrated how religiosity and professional ethics can effectively reduce the inaccuracy of accountants in preparing financial statements. The beliefs of accountants and preparers of financial statements can often have a greater impact than reporting laws and standards. Since accountants’ dishonesty has highly destructive effects on society, economic stability, and public trust, the findings of the research suggest that strengthening accountants’ faith and moral beliefs can help prevent this harmful factor.ConclusionAt first glance, it might be expected that an accountant with strong religious principles would demonstrate higher moral standards, thereby preventing them from preparing reports and financial statements that deviate from accounting principles. However, this is not always the case, and in some instances, the result may be the opposite. In reality, if religious beliefs alone do not enhance the moral system, they cannot effectively mitigate fraudulent behavior. In such situations, religiosity without moral commitment may manifest as hypocritical behaviors, which not only fails to reduce wrongdoing, but may even exacerbate it. Without ethical commitment, managers and accountants may manipulate financial statements to make them appear favorable, altering the numbers to avoid managerial threats without adhering to ethical principles.
Financial Accounting
Zahra Eslami fard; Omid Pourheidari; Amirhossein Taebi naghandari
Abstract
Accounting is a reflection of the performance of economic entities, influenced by numerous factors. Culture is one of the most important factors influencing the development of accounting. This study explores how gender and social identity moderate the relationship between Islamic cultural values and ...
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Accounting is a reflection of the performance of economic entities, influenced by numerous factors. Culture is one of the most important factors influencing the development of accounting. This study explores how gender and social identity moderate the relationship between Islamic cultural values and the performance and attitudes within the auditing profession .This research follows an applied approach and employs a descriptive survey methodology. The study's population included all employees of the Audit Organization of Iran and doctoral students in accounting. A statistical sample of 384 individuals, composed of employees from the Iran Auditing Organization and accounting PhD students, was randomly selected based on Cochran’s formula for the year 1400. Data analysis was performed using the Structural Equation Modeling (SEM) approach with the Smart PLS software. The results indicated that there is a significant relationship between Islamic cultural values and employees' job performance and attitude. The study revealed that gender influences the relationship between Islamic cultural values and performance and attitudes within the auditing profession. However, social identity was found to have no significant impact on this relationship. Social identity has no effect on the relationship between cultural values of Islam and the function and attitude of the auditing profession. In conclusion, it is advisable to promote Islamic cultural values within the auditing profession to enhance ethical standards and professional competence.IntroductionThe increasing development and diversification of economic activities have led to the expansion of the capital market and the scope of activities of joint stock companies. Therefore, the duty and responsibility of professional auditors toward society and capital owners necessitates their adherence to a well-defined and consistent professional code of conduct, fostering acceptance, credibility, trust, and social respect (Turner, 2006).Career attitude is essentially an assessment of an individual's job, encapsulating their feelings, beliefs, and attachment to their occupation. Several variables influence the improvement of job attitudes, including age, education level, gender, work environment, years of service, competition, individual skills, job-specific skills, as well as the education and management approaches employed by audit supervisors (Kabir & Parvin, 2011).One of the most important factors influencing the development of accounting in any country is culture.Literature Review2.1. The effect of Islamic cultural values on the function and attitude of the auditing profession.Based on this discussion, the following hypotheses are presented:Hypothesis 1: There is a significant relationship between Islamic cultural values and the employees’ performance.Hypothesis 2: There is a significant relationship between Islamic cultural values and auditing staff’s job attitudeHypothesis 3: There is a significant relationship between the job attitude and performance of audit staff2.2 The effect of gender on the relationship between Islamic cultural values and the function and attitude of the auditing profession.Hypothesis 4: Gender affects the relationship between cultural values of Islam and auditing staff’s performance.Hypothesis 5: Gender affects the relationship between Islamic cultural values and auditing staff’s job attitude.Hypothesis 6: Gender affects the relationship between job attitude and audit staff performance.2.3. The effect of social identity on the relationship between Islamic cultural values and the function and attitude of the auditing profession.Hypothesis 7: Social identity affects the relationship between Islamic cultural values and auditing staff’s workHypothesis 8: Social identity affects the relationship between Islamic cultural values and auditing staff’s job attitude.Hypothesis 9: Social identity affects the relationship between job attitude and performance of audit staff.MethodologyThe research is applied and descriptive in nature, aiming to describe the effect of research variables during their implementation stages. The research population comprised employees of the Iran Auditing Organization and PhD students in auditing. We randomly selected a sample of 384 individuals based on Cochran's formula.To assess the fit of the measurement models, we employed criteria such as reliability and convergent validity. We evaluated questionnaire reliability using factor loading coefficients, Cronbach's alpha coefficient, and composite reliability. Data analysis involved the use of descriptive statistics as well as inferential statistics.ResultsThe purpose of this research was to examine the moderating role of gender and social identity in the relationship between Islamic cultural values and the function and attitude of the auditing profession. The results support the presence of a significant relationship between Islamic cultural values and auditor function, which aligns with the findings of Sayadi and Azizi (2016) and Hosseini and Babaei (2017). Additionally, the results reveal a significant connection between Islamic cultural values and auditor job attitudes, consistent with the findings of Sayadi and Azizi (2016) and Hosseini and Babaei (2017). Furthermore, the third hypothesis, suggesting a significant relationship between job attitude and audit staff performance, was confirmed, in accordance with Ali Fari et al.'s (2016) findings.The results indicate that gender significantly influences both Islamic cultural values and the performance of audit staff. Furthermore, gender has an effect on the relationship between Islamic cultural values and auditing staff’s job attitude. This result is inconsistent with the findings of Bani Mahd and Darvish (2015).The results also show that gender has an effect on the relationship between job attitude and performance of audit staff. This is consistent with the findings of Christensen et al. (2016), Sajjadi et al. (1401).Additionally, the results reveal that social identity does not affect the relationship between Islamic cultural values and auditing staff’s work. This is inconsistent with the findings of Badpa (2019).The results also show that social identity has no effect on the relationship between Islamic cultural values and auditing staff’s job attitude. This is in line with the findings of Ali Fari et al. (2016).Lastly, the results show that social identity has no effect on the relationship between job attitude and performance of audit staff. This is in line with the findings of Ali Fari et al. (2016). However, it is in contrast with the findings of Ebrahimzadeh et al. (1400) and Haqbin et al. (1401).AcknowledgmentsThe authors of the article express their appreciation and gratitude to the Islamic Azad University of Kerman branch.
