The Effect of Ethical Commitment Reminder and Reciprocity in the Workplace on Misreporting

Abstract

Despite the pervasive use of ethics training by companies, research in management accounting has not considered the effectiveness of such training in curtailing managers’ misreporting. This study examines the effect of ethics training on misreporting as a reminder to raise the awareness of employees’ ethical commitment. Furthermore, this study investigates the extent to which reciprocity in the workplace affects managers’ misreporting. The results from an experiment involving 124 managers show that in the absence of an ethical commitment reminder, managers are more likely to engage in misreporting than when an ethical commitment reminder is present. The results suggest that ethical commitment reminder interacts with reciprocity in the workplace, affecting managers’ misreporting. Specifically, the results reveal that managers are more likely to engage in misreporting under the reciprocity in the workplace condition when the ethical commitment reminder is absent. The theoretical and practical implications of these findings are discussed.

Effects of professional commitment, commitment to ethics, internal locus of control and emotional intelligence on the ability to detect fraud through reduced audit quality behaviors

“…Commitment to ethics has no positive effect on the ability to detect fraud. This study could not confirm previous research (Dammak et al , 2022; Ferdiansah et al , 2022; Rifai and Mardijuwono, 2020). It may cause an auditor with experience to be more responsive in detecting fraud.…”

“…Commitment to ethics has no positive effect on the ability to detect fraud. This study could not confirm previous research (Dammak et al, 2022;Ferdiansah et al,…”

“…Ethical considerations support someone to reveal fraud; this is reinforced by personal responsibility, and auditors who work in organizations with a highly ethical climate will be able to detect fraud (Dammak et al, 2022). Furthermore, Ferdiansah et al (2022) state that a person who commits to ethics will reduce errors in reporting. Integrity as a part of the commitment ethic positively effects on fraud detection and prevention (Rifai and Mardijuwono, 2020).…”

A Review of Organizations’ Cultural Controls on Corrupt Behavior

“…It would be worthwhile to explore more in-depth whether such a concept can improve the effect of codes of conduct on corrupt behavior. A recent study by Ferdiansah et al (2022) has found that the use of ethical commitment reminders can be used as an effective management control tool to deter unethical behaviors such as misreporting. Future studies can replicate this study in the context related to employees' corrupt behavior.…”

Editorial: Unethical Behaviours and Management Controls: Issues and Challenges to Management Accounting

“…Unethical behaviour, such as corruption, fraudulent financial reporting, or misreporting by organisations has attracted scholarly attention from accounting researchers and other disciplines (see e.g. Cardinaels & Jia, 2016;Changwony & Paterson, 2019;Chong & Wang, 2019;Everett, Neu & Rahaman, 2007;Ferdiansah, Chong, Wang & Woodliff, 2022;Free and Murphy, 2015;Hunt, Curtis & Rixom, 2022;Jeppesen, 2019;Jia, Lent & Zeng, 2014;Kroos, Schabus & Verbeeten, 2022;Maas & Yin, 2022;Mayhew & Murphy, 2014;Rabl, 2011;Van Vu, Tran, Van Nguyen & Lim, 2018). Understanding how and why unethical behaviours occur and how they can be prevented is an essential managerial issue.…”