TH 102

SAN PEDRO COLLEGE OF BUSINESS ADMINISTRATION
Km. 30 Old National Highway, Brgy. Nueva, San Pedro City, Laguna
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APPLICATION LEVEL OF THE NEW CODE OF ETHICS

ON THE PRACTICE OF PROFESSIONAL ACCOUNTANTS
IN SAN PEDRO CITY, LAGUNA
An Undergraduate Thesis
Presented to the Faculty of the
Department of Accountancy of the
San Pedro College of Business Administration
In Partial Fulfillment of the Requirements for the Degree
Bachelor of Science in Accountancy
Imperial, Mariel Rose P.

Oliva, Jhoee Razelle M.
Ruaza, Janice I.
.
San Pedro City, Laguna

May 2021
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ACKNOWLEDGEMENTS
As a researcher, we would like to thank the Almighty God for the provision of all
necessary things while doing our research. He gave us strength whenever we feel weak and
unmotivated. He guide us and take care of us whenever we stayed up late at night.
Our validators or panelists on teaching and guiding us through the end of our research.
We are thankful for them as they checked our questionnaires and correct our wrongs and guide us
on how to change our questions on the right.
Also, our classmate gave hand while we are in need of help. They served as one-chat-away
support for us whenever we feel down, and they are always ready to answer some of our questions
in regards to the process of making research.
Our researcher adviser Mr. Emmanuel Varona for teaching us what we should know and
checking patiently our research papers. Thanks to him we were able to learn new things about
research. To Mr. Alvin Insorio, and Mr. Felipe Ramores who provided us thorough and
constructive criticism on our thesis. We are thankful for them who taught us so many things.
Our family who inspires motivates, and is understanding if we are not always at home and
for going home late. Our parents who were being supportive and provide us with both mental and
financial support.
All the persons who have directly and indirectly contributed to the success of these academic
ventures.
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TABLE OF CONTENTS
Page
Title Page i
Acknowledgements ii
Table of Contents iii
List of Tables v
List of Figures vii
List of Appendices vii
CHAPTER 1: THE PROBLEM AND ITS SETTING
Introduction 01
Background of the Study 02
Statement of the Problem 04
Hypothesis 05
Theoretical Framework 05
Conceptual Framework 07
Scope and Limitation 09
Significance of the Study 09
Definition of Terms 10
CHAPTER 2: REVIEW OF RELATED LITERATURE AND STUDIES
Foreign Literature 12
Local Literature 17
Foreign Studies 19
Local Studies 28
Synthesis 36
CHAPTER 3: RESEARCH METHODOLOGY
Research Design 38
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Population and Sample 39
Data Gathering Procedure 39
Frequency 40
Percentage 41
Likert Scale 41
Weighted Mean 42
Cronbach’s alpha 42
Kolmogorov-Smirnov 43
Shapiro-Wilk Test 43
Mann-Whitney U Test 44
Kruskal-Wallis H test 45
CHAPTER 4: RESULTS AND DISCUSSIONS
Results and Discussions 46
CHAPTER 5: CONCLUSIONS AND RECOMMENDATIONS
Conclusions 64
Recommendations 67
REFERENCES 69
APPENDICES 72
CURRICULUM VITAE 81
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LIST OF TABLES
Table Title Page

1 Scale and Range Used to Interpret the Likert Scale 41
2 Demographic Profile of the Respondents in terms of Age 46
Demographic Profile of the Respondents in terms of Years of Professional

3 47
Experience
4 Demographic Profile of the Respondents in terms of Specialization 48
Ethical Factors Affecting the Practice of Professional Accountants in terms of

5 49
Potential Conflicts

6 50
Preparation and Reporting of Information

7 52
Acting with Sufficient Expertise

8 54
Financial Interest

9 55
Inducement
Summary of Ethical Factors Affecting the Practice of Professional

10 57
Accountants
11 Normality Test Using Kolmogorov-Smirnov and Shapiro-Wilk Test 58
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Kruskal-Wallis H test For Significant Difference on the Application Level of
12 the New Code of Ethics on the Practice of Professional Accountants When 59
Grouped According to Years of Professional Experience
13 the New Code of Ethics on the Practice of Professional Accountants When 60
Grouped According to Age
the New Code of Ethics on the Practice of Professional Accountants When

14 62
Grouped According to Specialization in Accounting
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LIST OF FIGURES
Figure Title Page
1 IPO Conceptual Framework Model 08
LIST OF APPENDICES
Appendix Title Page
A Certificate of Statistician 72
B Certificate of Grammarian 73
C Survey Questionnaire 74
D Computations of Raw Data 77
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CHAPTER 1
THE PROBLEM AND ITS SETTING
Introduction
Code of Ethics sets out an organization's ethical guidelines and best practices to follow
for honesty, integrity, and professionalism. It may be voluntarily adopted by the professionals,
or some even took a special course to fully learn the contents of the Code of ethics.
Understanding this is truly important because this clearly lays out the rules for behavior and
provides the groundwork for a preemptive warning.
The main categories of the Code of ethics include the following: a compliance-based
Code of ethics, a value-based code of ethics, and conduct of ethics among professionals.
(Hayes A.,2021). In a business, small or large, corporation or partnership, there will always be
expected unethical, malpractices, and inhumane activities that are happening in secret.
According to what is listed by Molis, (2018), causes of unethical behavior in the workplace
are not establishing a Code of ethics principles, fear of reprisal, impact of peer influence,
going down a slippery slope, and setting a bad example.
According to CIMA (2018), all professional accountants establish the fundamental
principles of professional ethics for professional accountants in accordance with the respective
department of the Board of Accountants. Code of Ethics is structured in the following: (1)
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complying with the Code, fundamental principles, and conceptual, (2) professional accountants
in business, and (3) professional accountants in public practice. This regulation sets out the
ground rules for decision-making for people who belong to a group. It is a form of self-
regulation. The expectation for this by the businesses is that professional accountants shall
understand and agree to abide by the Code of ethics as a condition and requirements to a
profession in practice (Deakin University & Griffith University, 2021).
The International Ethics Standards Board for Accountants (IESBA) is an international
standard-setting board that is responsible for issuing global ethics and independence standards
that has worked long and hard to reconstruct its ethics Code. The American Institute of Certified
Public Accountants (AICPA) and the Professional Ethics Executive Committee (PEEC) are the
ones who monitor the IESBA's standard-setting activities and may propose any updates or
improvements to the AICPA Code of Professional Conduct. In addition, when performing
services under the International Standards on Auditing (ISAs), social auditors must apply the
IESBA Code plus any national ethical requirement, which is stated to the Association of
International Certified Public Accountants (2021).
Background of the Study
Professional codes of ethics are social contracts among members of a professional group,
which aim to instigate, encourage, and nurture ethical behavior and prevent professional
misconduct (Komić, Marusic, and Marusic, 2015). The Code of ethics helps define the ethical
norms of an organization and guides employees towards understanding the standards and
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expectations for behavior. In the financial services industry, chartered financial analysts and
other financial professionals are required to follow a code of ethics in order to avoid situations
that could create a conflict of interest (Chen, 2020).
According to the University of West Florida (2017), ethics requires professionals to
comply with the laws and regulations that govern their jurisdictions and their bodies of work.
Professionals who want to be part of the company need to adhere to the business code. Failure
to comply with the Code repeatedly or intentionally will lead to an appropriate sanction and
legal action. But, do all employees are professional enough to see things fair and square? Or do
they perform the right ethics needed in their workplace?
Professional associations such as doctors, lawyers, and accountants, set up their own
professional Code of conduct which is named professional ethics. A professional person must
risk the professional attitude that may be encountered by such a person. Accountants perform a
critical social function of generating public trust in corporate financial reporting. As such,
ethical misconduct committed by professional accountants gravitated to have a broader impact
and be viewed as the reason to damage society.
This study was aligned in the revised 2016 edition of the Code of Ethics for Professional
Accountants issued by IESBA (2016 IESBA Code), which reflects the adopted framework to
guide auditors and other professional accountants in deciding what actions to take in the public
interest when they become aware of a potential illegal act, known as non-compliance with laws
and regulations (NOCLAR) committed by a client or employer.
The researchers chose the topic of the New Code of Ethics on the Practice of Professional
Accountants as the focus of our study that aims to give the readers the awareness of the ethics
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relating to professional accountants must possess and follow. Also, the researchers ought to
provide a reliable and effective level of the application of the said topic.
Statement of the Problem
This research seeks to find the answers on the impact of the application level of the new
Code of ethics on the practice of professional accountants. The general problem was specified
below:
1. What are the socio-demographic profile of the selected respondents in terms of:
a) Age;
b) Years of professional experience;
c) Specialization?
2. What are the ethical factors affecting the practice of professional accountants?
a) Potential conflicts
b) Preparation and reporting of information
c) Acting with sufficient practice
d) Financial Interests
e) Inducements?
3. What is the application level of the New Code Ethics on the Practice of Professional
Accountants in San Pedro City, Laguna?
4. Is there a significant difference in the application level of the new Code of ethics on the
practice of professional accountants according to their demographic profile?
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Hypothesis
In this study, the researchers will use the hypothesis below:
H0. There is no significant difference in the application level of the new Code of ethics
on the practice of professional accountants when they are grouped according to their
demographic profile.
Theoretical Framework
This research was based on the Four Component Model (FCM) of the ethical decision-
making model devised and developed by James Rest (1982). It is a framework where leaders
use to bring these principles to the company and ensure that they are followed. The FCM is
described as four processes thought to be independent and necessary contributors for moral
behavior: moral sensitivity, moral judgement, moral motivation and moral implementation
(Bebeau, 2013). This model is suitable to use in this study as a theory to support the
understanding in ethical behaviors and application. The FCM of James Rest was composed of
the following:
1) Ethical Sensitivity
2) Ethical Judgment
3) Ethical Motivation
4) Ethical Implementation
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The first component model, moral sensitivity or ethical sensitivity, is described as the
ability to recognize an ethical problem, the moral implications of our decisions, and how our
actions affect other people (Milliken, 2016). The essential element here is being able to see
things from the perspective of others, which requires a person to pay full attention in order to
hear an ethical problem in what someone says (Bragg, 2020).
Ethics like a culture of empathy and compassion should be addressed clearly. In some cases
that these were disregarded, these may be counted as ethical issues as occasionally it is hard to
understand because of ethical sensitivity. Ethical insensitivity is a sense of an individual's or
community's ability to recognize that an action or situation involving an ethical issue has been
hampered by other factors.
The second component of the FCM is ethical judgment or decision-making, a deliberative
process reflecting knowledge of ethical principles, theories, and codes. It involves deliberation
regarding the various considerations relevant to different courses of action and making a
judgment regarding which of the available actions would be most morally justifiable (Bebeau,
et al., 2017). Such judgments often reveal the beliefs that an individual applies in discriminating
between right and wrong and the attitudes that comprise his or her basic moral orientation. The
third component in the FCM, ethical motivation, is the bridge between decision-making and
action (Robichaux, 2017).
Ethical motivation or moral motivation is defined as a willingness to do the right thing even if
that entails personal costs. It is assessed using emotional attributions. Values such as self-
interest in terms of income or wealth, protection of one's organization or community, or self-
actualization might trump concern for doing what is just or right (Bebeau, et al., 2017). The last
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component, which is moral or ethical character and implementation skills focus on whether the
professional has sufficient determination, ego strength, toughness, the strength of conviction,
and courage to implement his or her moral reasoning (Bebeau, Cunningham, and Thoma, 2017).
Moral action involves taking the necessary steps to transform the intent to do the right thing
into reality. It is ethical if it is acted not only as good but should be morally good.
James Rest's FCM was an old model of moral behavior that was still used in several studies
and will also be used in this research. The four-component model: ethical sensitivity, ethical
judgment, ethical motivation, and ethical implementation are important individually as all the
components have their own contribution to moral behavior. It is suitable for this model to use
as a framework in this research because it tackles the level of ethics in the mind of a person.
Conceptual Framework
The focus of this study was undertaken by the following IPO conceptual framework, which
has a three-part process: the input, process, and output.
Figure 1 described the conceptual framework of the study wherein the input of this research
was considered as the socio-demographic profile of the selected respondents, whether Certified
Public Accountants (CPA) or Non-CPA professional accountants in the City of San Pedro,
Laguna. The socio-demographic profile of the respondents was distinguished by their age,
gender, years of professional experience, and specialization.
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The figure below also illustrated the process that the researchers would have to undertake
in order to gather the relevant data that will be needed. The researchers opted to execute a survey
questionnaire through their chosen medium, the Google form. Then, the researchers will gather
all the data and analyze it using the statistical treatment that is appropriate for their study.
Figure 1
IPO Conceptual Framework Model
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Lastly, Figure 1 indicated the output or the outcome of the data that the researchers gathered
and analyzed. The researchers are seeking for their expected outcomes such as: to know if there is
a significant difference in the application of the new Code of ethics on the practice of professional
accountants according to their years of professional experience; to give benefits in the practical
application of the new Code of ethics on the practice of professional accountants; and, to add new
findings to the importance of knowing the application level of the ethics.
Scope and Limitation
The focus of this study is to determine the application level of the new Code of ethics on
the practice of professional accountants in the City of San Pedro, Laguna. The data collection will
be conducted on fifty (50) respondents that were randomly selected by the researchers.
This study has conflicts in surveying the respondents in terms of connectivity, availability,
and approachability in which the researchers will use google forms to survey. Each of the
respondents will be given the same set of questionnaires. The main source of data will be the
questionnaire, which is prepared by researchers.
Significance of the Study
The researchers believe that the results of this study will give knowledge and additional
information for the readers of this study. This study was beneficial to the following:
To the accountancy students who aim to be professional accountants, this study will give
them an interest in the execution of ethical practices in the workplace.
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To the Businesses to be an eye-opener to all possible things that might occur in the
organization in terms of the ethical malpractices that might happen in secret.
To the Community to be informed of business matters that may affect the lives of the
people, and to know the reputation level of the business in terms of the operations.
To the Future researchers to be a new source of information regarding professional
accountant's Code of ethics.
To the Professionals accountants who are new to this kind of reality, this study will give
them awareness to be more careful and be aware in the workplace that was commonly exposed to
the threats in their career.
Definition of Terms
Accounting- the system of recording and summarizing business and financial transactions
and analyzing, verifying, and reporting the results
Bachelor of Science in Accountancy- a four-year degree that prepares students for entry-
level professional positions in public, private, or government accounting
Certified Public Accountants (CPA)- a trusted financial advisor who helps individuals,
businesses, and other organizations plan and reach their financial goals
Code of ethics - an individual's personal values or sense of right and wrong
Financial Professionals- knowledgeable about investments, corporate finance, and
accounting
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Financial Service Industry- encompasses many types of businesses involved in managing
money and plays a vital role in the world's economy.
International Ethics Standards Board for Accountants (IESBA) - an organization that
maintains the international Code of Ethics for Professional Accountants to serve as a model for all
codes of ethics developed and used by national accountancy organizations
Profession- a calling requiring specialized knowledge and often long and intensive
academic preparation
Specialization- the process of concentrating on and becoming an expert in a particular
subject or skill
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CHAPTER 2
REVIEW OF RELATED LITERATURE AND STUDIES
This chapter contains the related literature and studies in both local and foreign after a
thorough and in-depth search from local and foreign resources by the researchers. This reviews the
related literature, which supports and gives credence to the details of this research. The researchers
will anchor this comprehensive study to different viewpoints and perspectives to present a
thorough treatment of the problem. Concepts, findings, theories, and notions, from scholarly
researches and articles related to the application level of the new Code of ethics implied to the
professional accountants, are presented to provide an extensive background of the study and to
justify the researchers' objective in undertaking it.
Foreign Literatures
Running a business without a proper foundation of financial reports is like finding a
foreign address without a map. The owners and the people inside the business will not have any
idea or knowledge of what is happening on the capital account of the business. If the business
can still survive another business cycle or if the financial adviser or a professional accountant
can protect and manage the financial status of the business. This is the reason professional
accountants enjoy a unique and pivotal position in companies. Various aspects related to
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financial reporting and setting standards make their roles necessary, and organizations spend
extraordinary resources on them (Billah and Associates Inc., 2019).
This journal written by Billah and Associates Inc. (2019) listed the explanations of the role
and importance of the professional accountants in business in terms of (1) business strategy, (2)
data management, (3) preparing financial reports, (4) liaising with the external world, (5)
ensuring compliance, and (6) reducing costs. These six roles of the professional accountants in
business have their individual importance to the organization.
The first role of professional accountants is to recommend a useful and attainable business
strategy. Accountants are insightful and have a deep understanding of business resources. They
do not give any creative inputs in strategy formulation. However, they understand the
implications it will have on the business and the existing resources. Next, data management
where professional accountants were ensuring that the data complies with the prevailing laws
and also as mandated within the organization. The third role is to prepare a financial report.
This is mostly the job description made for professional accountants when applying for a job.
This is the practice and skills that only the graduate of the accountancy program can apply
accurately. The next on the list is liaising with the external world. This is where the professional
accountants provide further records of taxes paid, assets, and liabilities as required. Fifth on the
list is to ensure that the business is in compliance with the law and rules and regulations. Lastly,
reducing cost.
Businesses are always letting professional accountants help with statutory deductions.
Business ethics, in the most understandable word, was about the behavior that an employee
must possess in the workplace. According to Singh of Ecole Globale (2021), ethics played a
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very important role in education. School management sets certain standards in connection with
ethics, in terms of professional ethics, for the teachers that are applicable in their profession.
The significance of ethics cannot be disregarded at any level of life, and it is important that
ethics is practiced in the area of working experience. Ethics sets the standards of what is
acceptable and what is not; therefore, it is for the protection of the interest of both teachers and
professional accountants. It is an important part of the decision-making, but professional
accountants are not taught to think ethically and properly on how to apply the ethics they have
learned at school. Ethics, as defined by Ecole Globale (2021), is a broad term for learning
experience deliberate to help professional accountants grow ethically, whether in terms of
expanded ethical awareness and understanding or greater motivation to act ethically in the
whole world.
The motive of ethics was determined by Ecole Globale (2021) as not a directly learning
ethics for its purpose only for a certain happening. The main objective to deploy this body of
knowledge has two motives. The first motive is to grow intellectual dimensions that will
empower people to recognize ethical dimensions of issues and address them in the field of
medicines, economics, and policy, amid others. The second purpose is to develop critical
thinking skills, intentional on one's purposes, particularly the ability to reflect and the
theoretical and practical effect of personal and collective human actions.
Ethics govern the actions and activities of professions and organizations. Based upon the
work of Sachs (2020), without an ethical framework about professional ethics, student services
professionals are vulnerable to charges of unethical or unprofessional behavior. Professional
Accountants are responsible for guiding the accountants in the issues with regards to ethical
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conducts and standards: law, spirituality and religion, culture, institution, ethical codes, and
lastly for the professional accountants. Laws are deemed to align and guide the behavior,
programs, and activities of the individual or agencies of government in a specific community
or country. Workplace ethics is to not judge a professional's development, to guide and support
the spiritual journey of the professional accountants, and to facilitate different spiritual beliefs.
Moreover, it is important that professionals must understand the ways of life, the patterns of
behavior, and the different values that exist in the workplace or an organization.
The institution will have its own ethics standards by which it is expected that all employees
(and in many instances, also professional accountants) must abide. Accountants must be well
aware of some existing codes of ethics that are universally valid and others that are applicable
to specific organizations, professions, or programs. Accountants must have deeper knowledge
and understanding as individuals who come from different family backgrounds, religions (or
no religion), cultures, and values and needs.
Some companies have already established strong ethics policies that are implemented and
followed by their employees. American Management Association (2019), once stated "Know
and truly understood your company's values, not just the rules and regulations. In addition,
develop your own Code of conduct and follow it, regardless of where you work." Business
professional ethics conduct are important not only for the company itself but also for its people.
An employee is expected to have qualities that will help the company in all ways and be
prepared to make some adjustments for the sake of the company. But in some cases, the nature
of a company is unethical, to begin with. This kind of nature can be avoided if people were
taught about ethics properly. People are still hopeful that having the right application level of
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the new Code of ethics can be learned with the current economic disasters. Lack of knowledge
in the ethics section in employees will decrease in numbers.
Accounting ethics are the moral values and judgements that are applied to accountancy.
According to Thakur, and Vaidya (2019), it is one of the critical concepts to which every person
associated with accounting has to follow certain types of rules and guidelines set by the different
governing bodies having the power to set the same. In the governing and society bodies, it is
much stricter in the current day because they established preventive measures formed from the
previous scandals they encountered.
Moreover, accounting ethics have advantages and disadvantages wherein the advantage
pertains to the professionals who do not follow the guidelines will be held liable for the actions
they made, which will create fear in the mind of the future executor. The companies that pay
more attention to this topic are proven to be much better compared with other businesses as it
establishes the right image for the business. On the other side, the disadvantages are expensive
proper training for everyone involved that provides information on different rules and
regulations of this, and the required person will have to update the information regularly for the
implemented changes of the precept. Lastly, when a person decides to follow this course but
the management may not act in accordance with the intended guidelines will cause them to find
another work with a person who can provide a big advantage for them.
In relation to ethics, Prohaska (2013) explained the conscious and deliberate effort of the
accountants to create climates that encourage ethical employees' behavior is possible and can
be successful. Many accountants may be on edge about the current academic level of honesty.
However, accountants still do their best to have an effective application climate in their
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workplace for the, s their professions. It begins with the accountant's comprehension of the
central subject activities which by means of educating them about the connection between their
programs and explicating their own discoveries in each experience that will encourage them to
behave ethically. This happens when the accountants intrigue the professional accountants'
curiosity in learning and make some effort to master the subject matter material. Without such
engagement, bond, or commitment between the business and professional accountants,
unethical behaviors may flourish.
Local Literature
There was a growing consensus between the scientific community and the business world
at this time on the need to raise the "ethical awareness" of professional entrepreneurs in their
business operations (New Magazine Room, 2020). This awareness escalates the positive work
environment. The positive environment will deliver dramatic benefits for employers, workers,
and the bottom line is a large and growing representative research in positive organizational
psychology, says Blackman (2018). This kind of environment will be composed of an ethics code
and conducts and embodied with professional ethics.
Being ethically professional contains information of ethical behavior that tackles the
enhanced personality and aspect in life. Based on the statement of Fausto and Gomez (2011),
codes of ethics are very important for people to put into practice and learn because they will form
a personality in this world. Additionally, these are not also the meaning of attitude or right and
wrong; instead, they will be the guide of aspects in life and also in work. In the future, the role
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of the Code of ethics to accountancy professionals and businesses will not just be composed of
these codes but also incorporate the positive character and reflection of a prominent life.
This study is a stepping stone to be a successful professional if this role of the matter is
acknowledged and applied in economic activity. The decisions people make every day have
ethical and moral implications—choices of whether to run a renowned business or be a successful
manager with another company. Once decided, the person will know why a code of ethics
strategies are very important and how to execute it in the business' operations.
Ethical leadership means staying true to the moral principles while also being aware of
the complexity of certain ethical issues and being sensitive to different perspectives of the
employees, and managing disputes that may arise. To encourage others to do the same and act in
a certain way, they need to set goals and measure progress (Headphet.org, 2021). A successful
entrepreneur gives a code of ethics even if it is a fact that the business world is unmerciful but
still strives to be respectful in every business deal. The sign of successful entrepreneurship lies
in a beautiful personal code of ethics that ultimately leads to a skilled and affluent business
(Nogra, 2015).
According to Art BMX magazine (2021), the problems due to inadequate professional
ethics are not caused by one source or by the company; rather it caused by all levels of a state
who are equally responsible for their scarcely: invalid and irresponsible government policies;
allow and compromise leaders; corruption systems; the limited concern and importance are given
to the subject by educational entities; the unqualified or lack of knowledge on the subject on the
part of entrepreneurs and actors of the productive and commercial sector; the low attachment of
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the businessmen to the professional ethics; and people who have knowledge about the issue and
its consequences is acting irresponsibly.
Foreign Studies
Economic entities with an objective to gain profit are deemed to have an expected risk
level in the competitive environment of the businesses. The success to obtain this objective will
need an organized plan and strategies to create opportunities and build a decision to overcome
the barriers and to increase the facilitation of the factors. Role in the success of these
organizations does not always have the same weight of importance to every entity. It will depend
on the identity and status of the organization or business.
With that as the abstract of the study conducted by Alinia, Nikzad, and Yazdani (2016)
entitled 'The Study of the Role of Professional Ethics in Accounting,' the researchers of this paper
listed the importance of the professional ethics of the accountants in an organization or business.
Professional ethics, according to Alinia, et al. (2016), is a particular application of certain
guidelines that emphasize public morality lining that helps the individual to be in control of their
own behavior. This includes professional learning, professional behavior, and philosophy of law,
general principles of the professional point of view. These pursuits are known to have the
following features:
1. Responsibility for community services
2. Complex set of knowledge
3. Login to professional standards
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4. Need to trust in the community professional
Professional associations such as doctors, lawyers, and accountants, set up their own
professional Code of conduct which is named professional ethics. The main objective of the
Code of Professional Conduct is to achieve an (a) high level of ethical standards, (b) strengthen
communities, and (c) protect the professional interests of members and (d) users of professional
services. This Code of conduct has been developed as years passed by. Professional persons in
the community, clients, and/or other members of the profession shall be responsible with
appropriate manners to balance the elements that could be performed to assigned tasks. A
professional person must risk the professional attitude that may be encountered by such a person.
Accounting professionals must know the lack of social competence and professionalism and
know the strategies to solve those gaps.
As to what Alinia, et al. (2016) reasoned, ethics has a significant impact on the business'
operations and financial statements, it was because the right application of the professional ethics
of the accountants who managed the financial instruments of the business will reflect the increase
of the production, the improvement of the employees' communications, and reduces the degree
of risk.
This Code of Conduct of the professional accountants governs the professional ethics of
the business. This will facilitate the information to flow easily and learn about the right flow.
Application of the processes and techniques to the ethics of the Individuals and Groups Process
to organizational, Alinia, et al. (2016) listed the success that one business may gain from
following the professional ethics. The following is listed as:
1. Success comes from professional ethics.
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2. Ethics of professionals are caused by trust and belief.
3. To believe behavior can be predicted.
4. Predict the behavior of continuous and lawful behavior stems.
5. Continuous and regulate the liability that arises
6. Responsibility of law and individual beliefs are formed.
Alinia, et al. (2016) listed a set of recommendations for the findings and results of the
study such as (a) managers and decision-makers should have planned to develop ethics guideline;
(b) professional accountants should be at the top of the confidentiality in terms of providing
professional services and obtain such information without the explicit permission of the employer
to use or disclosure; (c) accountants should maintain and develop confidence with all the
professional responsibility to apply the highest form of integrity; (d) any auditor or accountant
should impartial the sense of responsibility; (e) each member shall achieve and improved the
quality and reliability of the services to work continuously effective and efficient.
In accordance with the study above mentioned, Izik and Keskin (2015) research that
called 'An Analysis of the Relationship between IFAC Code of Ethics and CPI' that had an
objective of understanding the primarily compatibility classification of the accounting code of
ethics encoded to the IFAC (The International Federation of Accountants). This is carried out on
the basis of the accounting action to plan on how to assess the levels of usage by the one hundred
and seventy-five (175) IFAC national accounting organizations.
When the business considers the professional ethics of the financial management as a
code of conduct internalized by the industry, it becomes evident that it is necessary for all the
organizations which interact with the close circles to act sensitively in terms of ethical standards.
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When the international accounting code of ethics is reviewed IFAC, it contributes to the
development, adoption, and implementation of high-quality, ethical standards for the
accountants through the International Ethics Standards Board for Accountants' (IESBA)
support IESBA, 2. According to Izik and Keskin (2015), IESBA's long-term objective is to
converge the rule of the Code of ethics, which is valid for the accountants, with the standards
published by the regulators and standard setters. Convergence to only one set of standards may
increase the quality and consistency of the services provided by accountants all over the world.
Also, to improve the efficiency of the global capital markets.
The Code of ethics for the IESBA is composed of three major parts. The first part tackles
the general application of the Code to professional accountants. Also, IESBA has two kinds of
professional accountants in terms of the chosen work field, professional accountants in public
practice and professional accountants in business. Although it is determined whether the IFAC
code is used by the businesses through benefiting from the action plans, the organizations are
grouped by taking the classifications, including the level of usage of the IFAC code by the
business as a reference. These classifications were presented in the aforesaid surveys on the
IFAC website, where the researchers of the said study conducted their survey to the respondents.
Transparency International's corruption perception index (CPI) of 2014 data was also
categorized by Izik and Keskin (2015). Four (4) of the countries within the one hundred and
seventy-nine (179) member and associate member organizations are not evaluated in the CPI.
These countries are (1) Brunei, Darussalam, (2) Fiji, Palestinian, (3) Territory Occupied, and (4)
the Cayman Islands. Therefore, occupational organizations belonging to these four countries
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were excluded from the list in the analysis of the relationship between the CPI and the Code of
Ethics.
In accordance with the limitations of the study conducted by Izik and Keskin, the
recommendations of the research pointed out several points to consider by the IFAC in terms of
the CPI results of the surveyed countries (2015). Rules, laws, and regulations similar to the
countries where the corruption level was observed to be lower than other respondents deemed to
be accepted by the society more than the countries with the higher level of corruption. This has
provided an opportunity for the creation of ethical rules in the occupational organizations of the
countries, and the application of these rules is as necessary as the organizations' honor.
Professional Accountants perform a critical social function of generating public trust in
corporate financial reporting. As such, ethical misconduct committed by professional
accountants gravitated to have a broader impact and be viewed as the reason to damage society.
Directive continuing ethics training by professional and industry regulators underscores the
importance of professional accountants' ethical behavior; however, there exists uncertainty as to
how best to conduct ethics training so that it achieves its goal of enhancing ethical capability.
The study of Cote and Latham (2018) had a hypothesis that Participants who receive the action-
oriented ethics training will be less likely to indicate concession to the client than participants
who receive the traditional ethics training.
In obtaining the results of their study, they did an experimental task. In the experimental
task, the researchers made a scenario where the tax partner was on an engagement of a privately
held entity and faced an ethical challenge surrounding a contentious issue on which the client is
holding a firm. The challenge in this scenario involves the valuation of undeveloped land, given
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as a charitable donation, that will be used as a deduction to offset significant tax liability for the
client. The tax partner believed, based on the partner's research, the client's estimate is
significantly overstated and has concerns about the objectivity of the appraiser used by the client.
Upon testing the hypothesis of their study, the results of this experiment where the respondents
will be less likely to indicate conceding to the clients. This finding accepts the hypothesis of Cote
and Latham (2018).
The present studies aimed to highlight the role of professional accountants as consultants,
namely to provide the best services in the financial, accounting, fiscal, human resources, etc.
fields, offering solutions that help the enterprises to improve their activity by increasing
efficiency and productivity, giving them a quality product by extracting from the legal and
financial chaos, practical solutions for the problems the business are facing. The managers of
firms have as their primary task finding the most effective ways to ensure the performance in
their activity, obtaining superior results in short intervals of time, and ensuring the continuity of
the improvement process of their activity. However, the solution to overcome the crisis period
is not only related to their management, authorities, or banks, but mist takes the form of an
agreement between all participants at the economic life of the country, including with the
accounting profession, by granted consultancy (Necsulescu, and Sirbu, 2017).
In order to understand the role of the accounting profession in providing business
consultancy to small and medium enterprises (SMEs), it is important to establish the general
context in which this important role. The SMEs operate in very different areas and are themselves
very diverse in nature (comprising micro and medium enterprises). The problems with which
business faces are different as the calendar pages decrease. Potential beneficiaries of business
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consultancy services are characterized by diverse requests and a heterogeneous behavior toward
the professional accountants and the services offered by the business. Therefore, the policies and
practices that aim at the needs of SMEs must take full account of this diversity. The research
findings obtained by Necsulescu and Sirbu (2017), a professional accountant should not only
resume the mechanical and literal recording of the documents at the preparation of financial
statements. As the principal financial advisor of a company, professional accountants will have
to work for:
1) analysis of costs and informing the society’s management about the abnormalities that
are found;
2) identification of distortions generated by inflation, the impact on the
company’s management, causing the managers to act accordingly;
3) quantifying the incidence, depreciation of the national currency on financing
the company;
4) details in the analysis of the accounts of expenditure, especially, taken into account
that an accounting held only synthetic, may determine troubles and difficulties that may go until
entering into insolvency.
These past decades, the accounting scandals in the business industry, and indeed, in the
government entities, had been in question for many years. These scandals started from the
financial handler of the entities that caused threats to the organizations. In accordance to what
listed in the Handbook of the Code of Ethics for Professional Accountants, the threats can be
categorized in five as follows:
(a) Self-interest;
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(b) Self-review;
(c) Advocacy;
(d) Familiarity; and
(e) Intimidation.
In line with the list above mentioned, a study researched by Mbanjwa (2019) was
informed by these occurrences and the effect that this had on the perceptions of the profession.
The relevance of ethics to accountants and auditors is the professional requirement to Substantial
Compliantly exercise ethical judgment. The study conducted by the researcher mentioned above
has four research questions under the themes as what follows: "Knowledge of the SAICA Code of
Conduct'', "How accountants and auditors maintain the required ethical standards," "Pressures
faced to compromise on ethics," and "Perceptions about compatriots."
According to Triyuwono (2015), the decision of taking a particular action, as driven by
the internal part of the individual, is what is referred to as that individual's ethical judgment. In
doing an ethical action, it is the individual's mental assessment of possible actions that leads the
individual to take a specific action in an ethical direction (Triyuwono,2015). Perceptions are
considered relevant to the discourse on accounting and auditing ethics because the manner in
which society views the profession is an important factor. The profession has to maintain public
trust for it to provide the service and assurance that it purposes. Without the public trusting the
authenticity of the service provided, the profession falls apart. Unethical conduct and lack of
professional skepticism have the effect of weakening the justification for the existence of the
profession –so does the perception that there is unethical conduct or lack of professional
skepticism (Caglio & Cameran, 2017).
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The findings of the research administered by Mbanjwa (2019) firstly confirm that
accounting and auditing professionals do have knowledge of the requisite behavior and view
themselves as being compliant. Secondly, the findings confirm the existence of pressures on
accountants and auditors to lax their professional ethics and professional skepticism during the
provision of their services. Finally, the results of the study provide evidence that accountants and
auditors have a perception that fellow members of the profession do comply with the requisite
professional ethics and professional skepticism. These findings should be useful to regulators,
government, and executive leadership of accounting and auditing firms in that they have
highlighted the existence of pressures to compromise professional ethics and professional
skepticism. They have also provided an indication as to some of the areas where accounting and
auditing professionals view themselves to be not in compliance with the requirements –such as
annual attendance of ethics training.
Local Studies
Among professionals, ethics extend beyond moral principles. These include the standards
of behavior that are designed for both practical and idealistic purposes (Custodio, 2018). With
this premise, people in managerial and supervisory positions, either in public or private
organizations, are expected to have strong personal values and high levels of moral reasoning in
order to withstand client pressures; and deliver independent professional judgment.
These expectations are imperative considering the global world economic crisis, which
came about with vast impacts on the population, workforce, and business. Unethical business
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practices have been put on display and identified as key factors in the economic crisis. The
management of both public and private organizations is driven by profit-making motives, and
this leaves very little room for other aspects, such as ethics. Therefore, the study obtained by
Custodio (2018) had the objective of understanding and determining the ethical inclinations of
accountancy graduate professional accountants at a state university in Catanduanes, Philippines.
The study of Custodio (2018) aimed to (1) determine the head and heart values among
accountant graduate professional accountants at a state university in Catanduanes, Philippines;
(2) to evaluate the influence of age, gender, and curricular program affiliation of the respondents
on the head and heart values; and (3) to investigate any significant difference between the
master’s and doctoral professional accountants’ attribution on the importance of the head and
heart values. The findings and results on the study indicated that the ten traits ((1)
cooperativeness, (2) open-mindedness, (3) self-confidence, (4) ability to take the initiative, (5)
pleasure in learning something new, (6) flexibility, (7) coolness under stress, (8) pride in
performance, (9) satisfaction in creating something new, and (10) honesty) had appeared to be
very important for the respondents of the research by Custodio (2018).
It is emphasized, however, that valuing honesty suggests that the respondents are well
aware of being objective and unbiased in coming up with sound decision-making. Integrity is a
value that the university emphasized as one of its core values. Additionally, it is believed that
professional accountants are aware and conscious of the value of honesty in any human endeavor
considering the fact that they are all professionals. Professionals should adhere to the requisites
of the "Code of Professional Ethics".
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Describing the most important part of the Code of ethics for the fresh, professional
accountant graduates, according to the previous researcher, Ng (2019), the success of any
organization depends in part on the kind of leadership its manager has – not only on the style of
leadership he portrays but also on the ethical foundation that this leadership style is built. The
study entitled 'On Ethics and Leadership: Levels of Transformational Leadership and
Occupational Work Ethic of Educational Middle Accountant Managers of De La Salle Lipa,
Philippines' had a direct objective of looking and determining the transformational leadership
level using the Work Ethic Model by Petty and Hill.
Ng (2019) enumerated the components of the working ethics of the respondents. These
are in terms of interpersonal skills, initiative, and being dependable. With the results and findings,
the overall mean score for occupational work ethic is 6.23, which translates to Moderately High.
In general, a positive occupational work ethic is noted among the participants, with almost all
mean scores from the items translating to moderately high. This is favorable, as one study has
found out that developing a sound work ethic in school helps build the ethics of professional
accountants and prepares them for the competitive nature of today's workplace. The said study
has likewise reiterated that despite its difficulty and complexity, it is better if the assessment of
work ethic is done quantitatively, which has been the case in this present undertaking.
Based on the findings of Ng’s (2019) study, it is thus recommended that the action plans
detailed in the previous section be taken into thorough consideration by De La Salle Lipa to
enhance both ethics and leadership skills among its appointed accountant administrators. As
regards the conduct of future similar studies, the following recommendations are made: to include
other middle accountant managers from the same institution in the assessment of transformational
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leadership and occupational work ethic; to supplement current results with qualitative data on the
practice of both ethics and leadership among the middle managers of De La Salle Lipa, and to
explore on the levels of leadership of these managers with reference to other leadership styles.
In agreement with the study of Ng, the competency knowledge, skills, values, and
leadership were almost used and applied for every operation that a professional accountant
deemed to finish. Accounting and finance knowledge was considered vital in their work.
Teamwork, analytical thinking, and writing and oral communications were highlighted.
Likewise, professional values, ethics, and morals were almost always observed and practiced in
rendering accounting services to the clientele.
These were abstract to the study conducted by Lim, Payabyab, and Rufino (2018). Based
on the listed researchers, Professional accountants also participated in the different CPD activities
to earn CPD units. Most of the activities participated were attending training, seminars, and
workshops, particularly topics on current and recent issuances on accounting and financial
reporting standards. Only a few have participated or conducted self-directed and or lifelong
learning. Aligned on these, recommendations were made to enhance the accounting curriculum.
Based on the conclusions that Lim, et al. (2018) went through, the majority of the
professional accountants were engaged in the service type of business. The majority were
employed or working in corporations. The respondents were fairly distributed among the four
sectors of the accountancy profession. Most of the respondents were presently employed in the
company for 1 to 5 years. The majority of the professional accountants were in an entry-level
position. Professional values were inherent to the practice of the accountancy profession.
Professional accountants always distinguished and worked for what is morally right from wrong
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in their respective works. Professional accountants uphold utmost integrity and objectivity, and
independence and adhere to professional competence to perform their work efficiently and
effectively. In the same manner, professional accountants strictly observe and uphold
confidentiality and professional behavior for the best interest of the public, professional
accountants, customers, management, and other stakeholders for whom the services are
performed.
The implementation of the new Code of ethics for professional accountants in the modern
days is continuously developing and evolving and has been spread out and already adapted by
business firms and industries. The survey of Piasecki and Gudowski (2017) also claimed that
professional ethics actions were very important in engaging social affairs to local society from
the point of view of small and medium-sized companies. The new Code of ethics actions such as
supporting local cultural actions, participation in charity drives, rewarding competitions, offering
assistance in programs for disabled persons, protecting the environment, and implementing
ethical standards for business are treated as tools of public relations and can improve a company's
image. In that case, the business firms and industries were encouraging the higher education
institutions to provide enough knowledge and information about professional ethics, especially
for the tertiary business-related programs such as accountancy.
In the study that was conducted by Pascua (2020) in Isabela State University--Philippines,
professional ethics was a way to encourage business firms to operate in an appropriate manner
according to the desires of the stakeholders, thus causing them to act responsibly for the benefit
of the business and society through creating a sustainable social, environmental, and economic
development that could, in turn, gain positive image and reputation for the company. Pascua
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(2020) concluded that practices of business establishments along the four responsibilities
(philanthropic, ethical, legal, and economic) are still developing and need further enhancement
in terms of its impact on society and community development as well as to the company's image
and reputation.
Moreover, among the four parameters of the abovementioned course, the philanthropic
activities were less sustainable since each business establishment had only a few activities and
had no continuity in conducting the professional ethics of accountancy towards the society or the
community. The scholarship for accountants in the philanthropic dimension is considered as a
best practice because it demonstrates a sustainable program, creates value for both business and
society, and gains impact on the social development of the community, as well as improves the
standard of living of the citizens. However, the sponsorship to public schools and environmental
greening programs can be considered as best practice, especially if it becomes a sustainable
philanthropic activity such as adopt-a-school and adopt-a-forest program. In addition, the skills
enhancement project can also be a livelihood project that develops entrepreneurs in the region if
it becomes a sustainable activity.
Thus, education institutions that are implementing business and professional ethics should
look into a sustainable activity that can create an impact and value to the future work and society,
thus helping in community development as well as building students' image and reputation for
their future employers.
In accordance with the research that was conducted by Pascua (2020), another research
that studies the different strategies of one higher education institutions may use to apply and
teach business ethics, Code and conduct, social responsibility, and the way to have good ethics
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at work to the undergraduate of the accountancy curriculum. It was researched by Manalo (2013).
The researcher's main objectives were to seek and determine what teaching strategies to employ
when teaching business ethics courses to undergraduate accounting major students enrolled in
the RVR College of Business at De La Salle University. Manalo (2013) conducted a survey of
students taking Bachelor in Science of Accountancy from freshman to senior year levels. The
students were asked to rank from among eight choices of teaching strategies to determine what
will prove to be their preferred strategies when they take up business and professional ethics
courses.
Some of the more prominent teaching strategies that Manalo (2013) listed are: (1) lecture
method; (2) sub-group or collaborative learning; (3) case studies; (4) role plays, film/video,
literature, and games; (5) personal value journals; (6) guest speakers and practitioner
participation; (7) service-learning; and (8) E-learning. The first strategy was the lecture method,
which is the practice of having the teacher, or lecturer, at the front of the classroom talking to
students. The second was the sub-group learning through ethical discussion, exposure to
alternative viewpoints, and collaborative learning, which is a situation in which two or more
people learn or attempt to learn something together. The third strategy was the case study method,
where students will spend classroom time discussing cases about actual ethical business problems
and possible solutions. The fourth strategy was role plays, film/video, literature, and games.
Oxford English Dictionary (n.d.) defines role-playing as "the changing of one's behavior to fulfill
a social role".
Next on the list was the personal value journals, which introduces the professional
accountants to the notions of personal reflection through activities such as self-assessment and
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proactive reading of materials. The sixth strategy, which is inviting guest speakers for practitioner
participation in the education of the "would-be CPAs", would allow future accountants to learn
from someone who has actually experienced how to be a part of the real world of business and
how applying sets of ethical standards made the person think and act more powerfully rather than
considering only financial and personal gains. While the seventh strategy, the students are
encouraged to participate in community service. Lastly, the eighth strategy encompasses forms
of technology-enhanced learning (TEL) or very specific types of TEL such as online or web-
based learning.
Manalo (2013) showed that sub-group learning through ethical discussion, exposure to
alternative viewpoints, and collaborative learning was ranked first with a mean score of 3.46,
followed by the lecture method with a mean score of 3.75. Role-plays, film/movie shows,
literature, and games were ranked third with a mean score of 4.07, followed by inviting guest
speakers for practitioner participation with a mean score of 4.30. The case study method, personal
value journal, and service-learning were ranked fifth, sixth, and seventh, respectively. It is
interesting to note that students ranked last/eighth in the teaching strategy using electronic
learning or E-learning when teaching business ethics. This can give an idea that even though
students are adept at using the computer and the Internet, they would still prefer actual classroom
experiences in learning ethics courses. The researcher quoted, "In a constantly changing
environment, accountants must not only acquire technical accounting knowledge and skills, but
also acquire integrity, objectivity, and the skills that enable them to take a firm stand in difficult
situations".
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As future workers of this industry, the accountants who will handle the finances of the
entities have a large responsibility for their chosen professions. In practice for the events which
they will encounter for the next few years, the competency level requirements for the accountants
will be seen in the enhanced curriculum for the accounting program. This includes the
competency knowledge, skills, and values that the future accountants will most likely use or
applied in their work. In the same manner, the study of Lim, Payabyab, and Rufino (2018) in the
Tarlac State University, had a main focus on the professional values, ethics, and morals, which
were almost always observed and practiced in rendering accounting services.
The challenge for every BSA student does not end in passing the board examination and
becoming Certified Public Accountant but continues in landing a work that is matched and related
to accounting. Becoming a professional accountant helps ease landing a job but maintaining the
competencies for accountants will keep them in the profession. Thus, while studying to become
a professional accountant, Lim, et al. (2018) identified the three competency skills that a student
must be formed in their perspective. Those three were technical competence, professional skills,
and professional values, ethics, and morals.
As to the findings and results of Lim, et al. (2018) study, it explained that professional
accountants are expected to perform their tasks or practice the accountancy profession with
professional competencies – knowledge, skills, and values. Their survey results showed that
professional accountants almost always applied these competencies in their work with a grand
mean score of 3.98. This means that these competencies, as determined in the competency
framework for accountants in the Philippines, are still relevant and so to the core competencies
expected to the graduate accounting students.
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In order to help the BSA students face these challenges, accounting education plays a
vital role. Accounting education is expected to produce technically and ethically competent
professional accountants (Lim, et al., 2018) to meet the employers' expectations in terms of
learning and professional development.
Synthesis
The challenge for every BSA student does not end in passing the board examination and
becoming Certified Public Accountant but continues in landing a work that is matched and related
to accounting. Becoming a professional accountant helps ease landing a job but maintaining the
competencies for accountants will keep them in the profession.
With this premise, people in managerial and supervisory positions, either in public or
private organizations, are expected to have strong personal values and high levels of moral
reasoning in order to withstand client pressures; and deliver independent professional judgment.
The success of any organization depends in part on the kind of leadership its manager has – not
only on the style of leadership he portrays but also on the ethical foundation that this leadership
style is built on. Role in the success of these organizations does not always have the same weight
of importance to every entity. It will depend on the identity and status of the organization or
business. Therefore, the policies and practices that aim at the needs of every business
organization must take full account of this diversity.
This Code of Conduct of the professional accountants governs the professional ethics of
the business. This will facilitate the information to flow easily and learn about the right flow.
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Application of the processes and techniques to the ethics of the Individuals and Groups Process
to organizational lists the success that one business may gain from following the professional
ethics.
A successful entrepreneur gives a code of ethics even if it is a fact that the business world
is unmerciful but still strives to be respectful in every business deal. The sign of successful
entrepreneurship lies in a beautiful personal code of ethics that ultimately leads to a skilled and
affluent business.
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CHAPTER 3
RESEARCH METHODOLOGY
This chapter aims to highlight the design and methodology were used to obtain the
required data. It explains thoroughly the research design, respondents of the study, data gathering
procedure, and also the treatment and analysis of the hypothesis.
Research Design
This is a non-experimental study on the application level of the new code of ethics on the
practice of professional accountants in the City of San Pedro, Laguna. This study utilized
descriptive studies. The goal of this research design is to describe a phenomenon and its
characteristics. This type of study is more concerned with what rather than how or why something
has happened. Therefore, observation and survey tools are often used to gather data (Gall, Gall,
& Borg, 2007). In such a study, according to Nassaji (2015), the data may be collected
qualitatively, but it is often analyzed quantitatively, using frequencies, percentages, averages, or
other statistical analyses to determine relationships.
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Population and Sample
This study composed a certain population of professional accountants that can be found in
San Pedro, Laguna. These professional accountants took the Bachelor of Science in Accountancy
(BSA) program and gained a degree at the said higher education program. The researchers
conducted the research with seventy professional accountants to have 85% statistical power,
whether they have a license of being a CPA or not, as this license will not affect the researchers'
study credibility to obtain the needed data to provide thorough findings and results.
As the researchers had limited sources to gather the entire population of the professional
accountants in business that are currently working inside the City of San Pedro in Laguna, the
sample size of the selected respondents was utilized using the random sampling method.
According to Cherry (2020), when researchers need to select a representative sample from a
larger population, they often utilize a method known as random selection. In this selection
process, each member of a group stands an equal chance of being chosen as a participant in the
study.
Data Gathering Procedure
This study was established in the midst of a pandemic. Traditionally, researchers will
have to go to the place of the respondents then gather data through face-to-face transactions.
However, due to the pandemic (Covid 19), the researchers' only choice is to conduct the study
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using their available technologies, Internet, and by using survey questionnaires through online
(Google forms).
The technologies and Internet will be used to find and seek related literature and studies,
definitions, online studies tutorials, and any other study materials that can be found using search
engines on the web to identify the primary (online study papers, online manuscripts, government
online publications, and etc.) and secondary sources (online journal articles, scanned and
interpreted studies, online newspapers, blogs, and etc.) of the researchers.
On the other hand, the survey questionnaire was aligned in the statement of the problem
that the researchers previously enumerated in the early chapters of this study manuscript. The
target respondents of the study are professional accountants in the City of San Pedro in Laguna.
Afterward, the respondents were given the link to the questionnaire through e-mail or
messenger. The questionnaires were checked, tallied, interpreted, and analyzed by the researchers
after reaching the number of the required respondents that answered the questionnaire.
Hypothesis Testing
The researchers used different hypothesis testing methods through the use of Statistical
Package for the Social Sciences (SPSS) version 23 to arise with appropriate findings to reconcile
with the hypothesis established in Chapter One of this study. The researchers will use relative
frequency, weighted mean, percentage, Cronbach’s Alpha, Kolmogorov-Smirnov, Shapiro-Wilk
Test, Mann-Whitney U Test, and Kruskal-Wallis H test.
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Frequency. This is used to count the number from a particular data. The researchers used
this tool in the demographic portion of the survey questionnaire which is the research question
number 1.
Percentage – It is used to determine the demographic profile of the respondents. Thi8s
formula was used for the demographic profile of the respondents.
𝑓
𝑃= 𝑥 100
𝑛
Where:
P = percentage
f = number of the respondents
n = total number of the respondents
Likert Scale. It is used to score the responses to survey questionnaires.
To avoid biases in interpreting the responses, the ranges below were used.
Table 1
Scale and Range Used to Interpret the Likert Scale
Scale Range Interpretation
Strongly Agree/Full
4
3.28 – 4.00 Compliant
Agree/Substantial
3
2.52 – 3.27 Compliant
Disagree/Less
2
1.76 – 2.51 Substantial Compliant
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1.00 – 1.75 Strongly Disagree/least
Substantial Compliant
Weighted Mean. This is used to get valuable information from each respondent in relation
to the Likert-scale questionnaire administered by the researchers. The result obtained from using
this formula would help the researchers obtain the necessary interpretations on the valuable
inputs needed to address the established problems. This formula was used to answer the research
question number 2 and 3. The formula is shown below (Blay, 2007):
Xw=x1w1+x2w2+…xn(wn)w1+w2+…wn
Where:
Xw = Weighted Mean of the data concerned;
xn = represents the data considered;
wn = represents the weight of the data considered.
Cronbach’s alpha. This is used to measure used to assess the reliability, or internal
consistency, of a set of scale or test items. This formula computes the reliability index as a
requirement in constructing and validating the questionnaire.
where:
k refers to the number of scale items
Vi refers to the variance associated with the item i
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Vt refers to the variance associated with the observed total scores
Kolmogorov-Smirnov. This type of hypothesis testing examines if scores are likely to
follow a normal distribution in some populations which is required before the use of any
inferential statistical formula.
Where:
D = Maximum Fo (X) – Fr (X)
Fo (X) = Observed cumulative frequency distribution of a random sample of n
observations.
Fo(X) = k/n = (No. of observations ≤ X) / (Total no. of observations).
F(X) = The theoretical frequency distribution
Shapiro-Wilk Test. This is for test for normal distribution exhibiting high power,
leading to good results even with a small number of observations. In contrast to other
comparison tests, the Shapiro-Wilk test is only applicable to check for normality.
Where:
W = Shapiro-Wilk
n = number of observations
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Yt = values of the ordered sample
at = tabulated coefficients
Mann-Whitney U Test. Sometimes called the Mann Whitney Wilcoxon Test or the
Wilcoxon Rank Sum Test, is used to test whether two samples are likely to derive from the
same population (i.e., that the two populations have the same shape). Some investigators
interpret this test as comparing the medians between the two populations. This formula was
used to test the hypothesis when the responses were grouped into two categories.
Where:
U1 = U value for sample 1
U2 = U value for sample 2
n1 = number of observations in sample 1
R1 = ranks in sample 1
R2 = ranks in sample 2
n2 = number of observations in sample 2
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Kruskal-Wallis H test. Sometimes also called the "one-way ANOVA on ranks") is a rank-
based nonparametric test that can be used to determine if there are statistically significant
differences between two or more groups of an independent variable on a continuous or ordinal
dependent variable. It is considered the nonparametric alternative to the one-way ANOVA, and
an extension of the Mann-Whitney U test to allow the comparison of more than two independent
groups. This formula was used to test the hypothesis when the responses were grouped into two
categories.
Where:
H = Kruskal-Wallis
n = number of observations in sample k
∑〖R_i〗2 = Sum of squared ranks in sample k
ni = number of samples in a group
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Chapter 4
RESULTS AND DISCUSSION
This section of the thesis presents the analysis and interpretation of the data from the 70
respondents regarding application level of the new code of ethics on the practice of professional
accountants in San Pedro City, Laguna.
Table 2
Demographic Profile of the Respondents in terms of Age
Age frequency %
20-25 years old 19 27.10
26-30 years old 32 45.80
31 years old and above 19 27.10
Total 70 100
The table 2 shows that forty-five-point-seventy percent (45.70 percent) of respondents were
between the ages of 26 and 30. This is a significant percentage. Twenty-seven-point-ten percent
(27.10 percent) of respondents are over the age of 31 and between the ages of 20 and 25.
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Table 3
Demographic Profile of the Respondents in terms of Years of Professional Experience
Years frequency %
1-5 years 32 45.70
6-10 years 31 44.30
11 years and above 7 10
Total 70 100
Table 3 resulted to forty-five-point seventy percent (45.70%) in terms of 1 to 5 years of
professional experience are highly percentage. Forty-four-point thirty percent (44.30%) in terms
of 6 to 10 years of professional experience. Respondents’ years of experience above 11 years is
ten percent (10%).
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Table 4
Demographic Profile of the Respondents in terms of Specialization
Specialization frequency %
Auditor 8 11.40
Tax Accountant 8 11.40
Financial Accountant 16 22.90
Management Accountant 11 15.70
Financial Analyst 18 25.70
Academe 9 12.90
Total 70 100
Table 4 shows the profile of the respondents in terms of Specialization that Financial
Analyst are highly percentage above all with twenty-five-point seventy percent (25.70%).
Twenty-two-point ninety percent (22.90%) of the respondents in Financial Accountant. Fifteen-
point seventy (15.70%) of the respondents in Management Accountant. Respondents with
Specialization of Auditor and tax Accountant is eleven-point-forty percent (11.40%) of the total
respondents.
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Table 5
Ethical Factors Affecting the Practice of Professional Accountants in terms of Potential
Conflicts
STATEMENTS mean SD Interpretation Rank
I do not feel pressure in work that

Substantial
resulted in performing ethical 3.17 .90 4
Compliant
behavior.
I accepted any task willingly. Substantial

3.26 .81 2.5
Compliant
I will report any threat that might

Substantial
happen inside our workplace to 3.26 .77 2.5
Compliant
our management.
I do not compromise any
professional or business
judgement because of bias, 3.44 .75 Full Compliant 1
conflict of interest, or undue
influence of others.
Grand mean 3.28 Full Compliant
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With the grand mean of 3.28 resulted to Full Compliant interpretation, table 5 showed three
statements supporting the Potential Conflict as an ethical factor affecting the practice of
professional accountants have resulted to Substantial Compliant interpretation, and one statement
with Full Compliant. This has a meaning that the respondents are most likely accept the potential
conflicts in a positive way. Based on the findings of the research administered by Mbanjwa
(2019) which confirmed the existence of pressures on accountants and auditors to neglect their
professional ethics and professional skepticism during the provision of their services.
Table 6
Ethical Factors Affecting the Practice of Professional Accountants in terms of Preparation
and Reporting of Information
1. I have never experienced

Substantial
threats from our higher-ups 3.13 .93 6
Compliant
and clients.
2. I agree that threats are the
reasons for professional 3.46 .63 Full Compliant 4

accountants’ unethical acts.
3. I have never prepared Substantial

3.23 .80 5
financial or management Compliant
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reports that are against my
will.
4. I serve my clients and employ
professional organizations to
exercise sound judgment in 3.51 .61 Full Compliant 2

undertaking professional
activities.
5. I apply awareness and an
understanding of relevant
technical, professional, and
business developments to
3.47 .65 Full Compliant 3
develop and maintain the
capabilities to perform
competently to satisfy my
clients.
6. I know and understand any
inadvertent disclosure of any

information from my client to
anyone in any case.
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Table 6 have a Full Compliant interpretation and a grand mean of 3.39. This resulted with
two Substantial Compliant on the number 1 and 3 statements and four Full Compliant findings.
With the statement 6 as ranked by number 1 with Full Compliant and mean of 3.56, this statement
was supported by Alinia, Nikzad, and Yazdani (2016) with their research titled 'The Study of the
Role of Professional Ethics in Accounting,' they established professional learning, professional
behavior, and legal philosophy as general principles of the professional point of view, stating that
professional accountants should maintain the highest level of confidentiality when providing
professional services and obtain such information without the employer's explicit permission to
use or disclose it.
Table 7
Ethical Factors Affecting the Practice of Professional Accountants in terms of Acting with
Sufficient Expertise
1. My professionalism in my
work is the reason for me to 3.46 .77 Full Compliant 2

work ethically.
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2. I have given a task with
sufficient time to perform it 3.33 .86 Full Compliant 6

and able to finish it.
3. I personally agree that to
eliminate or reduce threats is

to establish a strong safeguard
policy in the workplace.
4. I diligently encompass the
responsibility to act in
accordance with the

requirements of a task
carefully, thoroughly and on a
timely basis.
5. I imply truthfulness and
fairness in the tasks assigned 3.47 .78 Full Compliant 1

to me.
6. I do undertake any activity if
a circumstance or relationship 3.41 .69 Full Compliant 4
duly influences my
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professional judgment
regarding that activity.
Table 7 shows a result of Full Compliant interpretation for its grand mean of 3.41. Acting
with Sufficient Expertise as an ethical factor have been one of the objectives of Cote and Latham
(2018) study. By the end of their research, they have concluded that Professionals in the
community, clients, or other members of the profession are accountable for balancing the elements
that could be accomplished. Professionals must risk the professional attitude they may encounter.
To close the social and professional barriers, accounting professionals must be aware of the issues.
Table 8
Ethical Factors Affecting the Practice of Professional Accountants in terms of Financial
Interest
1. I have correctly computed and made Full

3.33 .70 4
financial reports. Compliant
2. I never manipulated some of the

Full
documents (money-related) just to 3.43 .69 1
Compliant
have extra earnings.
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3. I never agreed on increasing my salary
Full
in exchange for doing them favors in 3.41 .69 2.5
Compliant
terms of financial reports.
4. I do not bring any form of disrespect Full

3.41 .73 2.5
to my profession. Compliant
Grand mean 3.40 Full
Compliant
The table 8 above have resulted with a Full Compliant and a grand mean of 3.40 indicated
that the respondents have a fair grasp of the ethical factors in terms of Financial Interests. With
the statement number 2 as the rank 1 which stated that the respondents have never manipulated
any documents to get extra earnings. According to Triyowono (2015), the profession must
maintain public trust in order to deliver the service and assurance that it serves its intended
purpose—without the public trusting the authenticity of the service supplied, the profession will
disintegrate.
Table 9
Ethical Factors Affecting the Practice of Professional Accountants in terms of Inducement
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1. If I have experienced receiving a client's gift
Full
and never use it as a threat to influence my 3.31 .83 3
Compliant
judgement or my decision-making.
2. I have complied with my head officer’s

Full
inducements and give good judgement 3.47 .65 2
Compliant
regarding the client’s matter.
3. I gave inducements to my clients not to

Full
receive a good performance evaluation but 3.20 .89 4
Compliant
only as a token of appreciation.
4. I do not omit or obscure any information/s that

Full
can cause misleading data in exchange for 3.59 .63 1
Compliant
something.
Grand mean 3.39 Full
Compliant
Table 9 shows a 3.39 grand mean which interprets as Full Compliant. With all four
statements that showed a high mean and scattered standard deviation, all of them have interprets
as Full Compliant. According to Art BMX magazine (2021), insufficient professional ethics are
caused by: invalid and irresponsible government policies; allow and compromise leaders; corrupt
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systems; limited concern and importance given to the subject by educational entities; unqualified
or lack of knowledge on the part of professionals.
Table 10
Summary of Ethical Factors Affecting the Practice of Professional Accountants
Factor mean SD Interpretation Rank
Potential conflicts 3.28 .68 Full Compliant 5
Preparation and reporting of 3.5

3.39 .58 Full Compliant
information
Acting with sufficient practice 3.41 .69 Full Compliant 1
Financial Interests 3.40 .65 Full Compliant 2
Inducement 3.39 .65 Full Compliant 3.5
Table 10 shows Full Compliant at all the questions pertaining to the Ethical factors answered
by the respondents. The higher the mean, the higher the expectations of each questionnaire to
reach a higher rank. With the ‘Acting with Sufficient Practice’ as a rank 1 among the 5 ethical
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factors showed that the present studies of Necsulescu, and Sirbu (2017) aimed to highlight the
role of professional accountants as consultants, namely to provide the best services in the fields
of financial accounting, taxation, human resources, etc., offering solutions that help enterprises
improve their efficiency and productivity, giving them a quality product by removing the legal
and financial chaos, practical solutions for problems the business are facing. Firm managers must
develop the most effective techniques to ensure their activity's success, achieving superior results
in short periods of time, and maintaining the activity's improvement process by using the
profession entitled to the accountants of their businesses.
However, even though the Potential Conflicts have resulted to Full Compliant grand mean,
it ranked as number 5 among all the ethical factors. Mbanjwa's (2019) research was influenced
by potential occurrences that could have a significant impact on the business and the effect on
public perceptions of the profession. The importance of ethics to accountants and auditors stems
from the professional obligation to exercise ethical judgment on a Substantial Compliant basis.
Table 11
Normality Test Using Kolmogorov-Smirnov and Shapiro-Wilk Test
Variable Kolmogorov-Smirnov Shapiro-Wilk
Statistic df p-value Statistic df p-value
Potential conflicts .183 70 .000 .890 70 .000
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Preparation and .166 70 .000 .889 70 .000
reporting of
information
Acting with sufficient .243 70 .000 .817 70 .000
practice
Financial Interests .223 70 .000 .826 70 .000
Inducement .240 70 .000 .831 70 .000
Table 11 shows the normality test of data using Kolmogorov-Smirnov and Shapiro-Wilk
tests as requirements before using any inferential statistical formula. Since the p-values of the
five variables are less than a .05 level of significance which means the data distributions do not
resemble the normal curve at a degree of freedom 70. It implies that a non-parametric test of a
difference is the most appropriate to use. The nonparametric test can be used for discrete
categories that do not meet the normal distribution assumptions for the parametric test
(Tabachnick & Fidell, 2013).
Table 12
Kruskal-Wallis H test For Significant Difference on the Application Level of the New Code
of Ethics on the Practice of Professional Accountants When Grouped According to Years
of Professional Experience
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Variable Computed df p-value Interpretation
value
Potential conflicts .439 2 .803 Not
significant
Preparation and reporting of .173 2 .917 Not
information significant
Acting with sufficient practice .362 2 .834 Not
significant
Financial Interests .878 2 .645 Not
significant
Inducement 1.117 2 .572 Not
significant
Table 12 presented above using the Kruskal-Wallis H Test shows that there is no significant
difference on the Application of the New Code of Ethics as to all respondents (any range of years)
when classified based on the professional experience as accountant. It means they have the same
practice of application of the new code of ethics. As what Manalo (2013) had stated, students
prefer practical classroom experiences in learning ethics courses, despite their proficiency with
computers and the Internet. Accountants must have integrity, objectivity, and the ability to take
a firm stand in challenging situations, according to Manalo.
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Table 13
of Ethics on the Practice of Professional Accountants When Grouped According to Age
value
Potential conflicts 1.037 2 .595 Not
significant
Preparation and reporting of 1.364 2 .506 Not
information significant
Acting with sufficient .465 2 .793 Not
practice significant
Financial Interests .327 2 .849 Not
significant
Inducement 3.405 2 .182 Not
significant
Note: Not significant means no significant difference on the Application Level of the New
Code of Ethics on the Practice of Professional Accountants when the grouped according to
age because the p-values are more than .05 level of significance.
Table 13 presented the outcome if there is a significant difference on the Application Level
of the New Code of Ethics on the Practice of Professional Accountants when the grouped
according to age. This table showed that there’s no significant difference between the age of the
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respondents to the level they applied on the New Code of Ethics. This was supported by the study
of Custodio (2018) that aimed to evaluate the influence of age, gender, and curricular program
affiliation of the respondents on the head and heart values. In his study that was conducted in the
Philippines showed that respondents value honesty indicates that they are fully aware of the
importance of being objective and fair in making rational decisions has less influence with the
professional accountants' age differences.
Table 14
of Ethics on the Practice of Professional Accountants When Grouped According to
Specialization in Accounting
value
Potential conflicts 3.282 2 .657 Not significant
Preparation and reporting of 1.808 2 .875 Not significant
information
Acting with sufficient 1.625 2 .897 Not significant
practice
Financial Interests 2.762 2 .737 Not significant
Inducement 4.112 2 .533 Not significant
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Note: Not significant means no significant difference on the Application Level of the New
Code of Ethics on the Practice of Professional Accountants when the grouped according to
specialization in accounting because the p-values are more than .05 level of significance.
Table 14 presented above means that with the Kruskal-Wallis H Test the specialization in
accounting of the respondents was not important in the Application of the New Code of Ethics
as to all respondents (any range of years) were aware of the importance of Code of Ethics (new
and old) in the practice of the Professional Accountants. According to Izik and Keskin (2015),
Professional accountants in public practice and professional accountants in business are two types
of IESBA members. The organizations are grouped based on classifications, which include the
level of usage of the IFAC code by the business as a reference only and not as a basis of the level
of awareness that one professional accountant must submit to.
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Chapter 5
CONCLUSIONS AND RECOMMENDATIONS
The following chapter concludes this research. It offers an overview of the research and
reviews, analysis and conclusions of the study. The significance of this research in the
immediate context of application level of the new code of ethics on the practice of professional
accountants in San Pedro City, Laguna. Recommendations for further research end the chapter.
The summary of the findings and results of the research showed that there is no
significant difference on the Application of the New Code of Ethics when classified based on
the age of the respondents, professional years’ experience, and specialization.
The scope of the following conclusions is limited to the context of application level of the
new code of ethics on the practice of professional accountants in San Pedro City, Laguna. Thus,
extended to other scenarios, these conclusions may produce false assumptions. Still, these
insights are pertinent to the process of dwelling evolution in progressive development projects.
Conclusions
Code of Ethics sets out an organization's ethical guidelines and best practices to follow for
honesty, integrity, and professionalism. From that, New Code of Ethics 2016 edition, it reflects
adopted framework to guide professional accountants from ethical factors affecting them like
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potential conflicts, preparation and reporting of information, acting with sufficient practice,
financial interest and inducements. Understanding this was truly important because this clearly
lays out the rules for behavior and provides the groundwork for a preemptive warning. The slight
difference of the new and old Code of Ethics may not be obvious but it was still a reminder that
accountants should always practice in legal way.
With the results and findings from the statement of the problems of the researchers are as
follows:
1. The socio-demographic profile of the selected respondents in terms of:
a) Age- twenty-seven-point-ten percent (27.10 percent) of respondents are over the age
of 31 and between the ages of 20 and 25.
b) Years of professional experience- forty-four-point thirty percent (44.30%) in terms of
6 to 10 years of professional experience. Respondents’ years of experience above 11 years is ten
percent (10%).
c) Specialization- profile of the respondents in terms of Specialization that Financial
Analyst are highly percentage above all with twenty-five-point seventy percent (25.70%).
2. The ethical factors affecting the practice of professional accountants?
a) Potential conflicts- showed three statements supporting the Potential Conflict as an
ethical factor affecting the practice of professional accountants have resulted to Substantial
Compliant interpretation, and one statement with Full Compliant.
b) Preparation and reporting of information- have a Full Compliant interpretation and a
grand mean of 3.39.
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c) Acting with sufficient practice- showed a result of Full Compliant interpretation for its
grand mean of 3.41.
d) Financial Interests- Full Compliant and a grand mean of 3.40 indicated that the
respondents have a fair grasp of the ethical factors in terms of Financial Interests.
e) Inducements- with all four statements that showed a high mean and scattered standard
deviation, all of them have interprets as Full Compliant.
3. The application level of the New Code Ethics on the Practice of Professional
Accountants in San Pedro City, Laguna resulted to Full Compliant at all the questions pertaining
to the Ethical factors answered by the respondents. The higher the mean, the higher the
expectations of each questionnaire to reach a higher rank.
4. No significant difference in the application level of the new Code of ethics on the practice
of professional accountants according to their demographic profile accepted the null hypothesis
of the researchers.
Professional accountants had an oath after the result of the licensure examination. It was a
statement or a promise to always be practice in accordance with law. Even after years in practice
the outcome should be the same. The professional accountants in San Pedro, Laguna were
dedicated with their jobs as this study resulted to highly frequency. Highly frequency was
interpreted as professionals have a balanced judgement, fair and square.
People may argue that unethical behavior may cause of pressure to achieve unrealistic
objectives which happened in any fieldwork but by all counts, and with proven results, it is no
wonder that acting with sufficient expertise and dignity can comply with code of ethics.
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Despite of the application level of the new code of ethics on the practice of professional
accountants to be comply with, more research is needed to develop new code of ethics that will
treat the most resistant strains of professional accountants and ease the unethical behavior affect
professionalism.
Recommendations
According to the findings of the researchers, the IESBA emphasizes the importance of
professional codes of ethics in identifying, evaluating, and addressing threats in order to make
informed decisions and gain an understanding of specific facts and circumstances, such as the
nature and scope of the professional activity or service; and the interest and relationship at
stake.
For instance, the researchers have recommended to consider the usage of professional
judgment along with their ethical judgement. The following are the lists of recommendations
made and analyzed by the researchers in accordance to their results and findings.
1. As an professional accountant in any fieldwork must be shown that we are the companies
assets. Perceive the company by deploy performance as professional accountant with
applying code of ethics and professional judgement wherein shown to be difficult to
influence from higher-ups or clients.
2. Professional accountant required to have an professional judgement in work, to prevent
unethical ways professional judgement must be applied in relations to client matters or
client intention. Accountant are more capable to controlled the companies performance
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by give good judgement regarding the client’s matter than companies controlled the
capability or professions.
3. Performance is important in the job of any professional like an accountant. Therefore, as
tasks are getting difficult to perform, it is necessary to have clear minds in order to focus
and strategize their work. But, be reminded that the work should be done in due time one
way or another.
4. In general, financial reports and correct computation are both difficult to make fairly.
Therefore, companies should be mindful of the transactions they have been involved in
and be aware of the updates to ensure six qualitative qualities of accounting (relevance,
representational fatihfullness, verifiability, timeliness, understandability, and
comparability).
5. By giving a token of appreciation to the client that a professional accountants have
worked at might consider a bad idea to the opinions of others, especially when giving out
an extravagant, big, or expensive gifts. In order to avoid or lessen any suspicions behind
the action, professional accountants might either write a letter of appreciation, a thank-
you emails, gift baskets, or implement a loyalty scheme to reward the client as the best
customer.
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References:
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Allen. C. R., (2018). A New Take on Ethics and Independence. Journal of Accountancy.
Billah and Associates Inc. (2019) Retrieved from:
https://www.accountingmississauga.ca/importance-of-professional-accountants-in-business/
Blackman, A. (2018). Paano Lumikha ng Positibong Kapaligiran ng Trabaho sa Para sa Inyong
Negosyo. Manila, Philippines. Envato Tuts+ Philppines.
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Bragg, S. (2020). Four Component Model Definition. Accounting Tools.
Caglio, A., & Cameran, M. (2017). Is it Shameful to be an Accountant? GenMe Perception (s)
of Accountants’ Ethics. Retrieved from: https://doi.org/10.1111/abac.12098
CFI. (n.d.). What is Nominal Data? Retrieved from:
https://corporatefinanceinstitute.com/resources/knowledge/other/nominal-
data/#:~:text=For%20nominal%20data%2C%20hypothesis%20testing,frequency%20of%20the
%20given%20values.
Chen, J. (2020). Corruption. Liberty Street, New York. Dotdash Publishing.
Cherry, K. (2020). The Random Selection Experiment Method. Liberty Street, New York.
Dotdash Publishing.
CIMA,.(2020). Code of Ethics at a Glance. CIMA.
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Cote, and Latham (2018). Ethics Training Approaches in Accountants’ Continuing Professional
Education. Mano'a, Hawaii. ScholarSpace, University of Hawaii.
Custodio, P. (2018). Ethical Inclinations of Accountant Graduate Professional Accountants at a
State University in Catanduanes, Philippines. Virac, Catanduanes. International Journal of
Innovation and Research in Educational Sciences.
Deakin University & Griffith University., (2021). Why Do We Need A Code Of Ethics?. Future
Learn.
Hayes, A., (2021). How Codes of Ethics Work. Investopedia.
Izik, E. Y., and Keskin, I. A. (2015). An Analysis of the Relationship between the IFAC Code of
Ethics and CPI. Pittsburgh, Turkey. D-scribe Digital Publishing Program.
Komić, D., Marušić, S.L., and Marušić A. (2015). Research Integrity and Research Ethics in
Professional Codes of Ethics: Survey of Terminology Used by Professional Organizations across
Research Disciplines. (n.p)
Lim, G., Payabyab, R., and Rufino, H. (2018). Competency Requirements for Professional
Accountants: Basis for Accounting Curriculum Enhancement. Tarlac, Philippines. Review of
Integrative Business and Economics Research.
Mbanjwa, R. M. (2019). Perceptions of Accountants and Auditors on Professional Ethics and
Professional Skepticism. United Kingdom. University of KwaZulu-Natal.
Molis, J. (2018). What Are the Causes of Unethical Behavior in the Workplace?. Bizfluent.
Necsulescu, E., and Sirbu, C. (2017). Professional Accountants as Consultants for Business.
Europe. EuroEconomica Publication.
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Ng, J. A. (2019). On Ethics and Leadership: Levels of Transformational Leadership and
Occupational Work Ethic of Educational Middle Accountant Managers of De La Salle Lipa,
Philippines. Lipa City, Philippines. International Journal of Advanced Research and
Publications.
Triyuwono, I. (2015). Awakening the Conscience Inside: The Spirituality of Code of Ethics for
Professional Accountants. Procedia -Social and Behavioral Sciences. Retrieved from:
https://doi.org/10.1016/j.sbspro.2015.01.362
Singh, A. (2021). Ethics in Education. Uttarakahnd, India. Ecole Globale.
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IntechOpen Limited.
Robichaux, C. (2017). Ethical Competence in Nursing Practice: Competencies, Skills, Decision-
Making (1st ed.). New York. Springer Publishing Company.
What is Ethical Leadership? (2021). Retrieved from: https://tl.headphet.org/what-is-ethical-
leadership-cms-31780-534
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APPENDIX A
CERTIFICATE OF STATISTICIAN
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APPENDIX B
CERTIFICATE OF GRAMMARIAN
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APPENDIX C
SURVEY QUESTIONNAIRE
To the Respondent,
We are currently conducting our research entitled; “Application Level of The New Code
Ethics on the Practice of Professional Accountants in San Pedro City, Laguna" as partial
fulfillment of our course requirement for the subject Accounting Research Methods at San Pedro
College of Business Administration. In this light, we are humbly requesting your time and effort
to go over this questionnaire as your responses will be very much helpful in achieving the purpose
of our research. Rest assured that the information you will provide will be kept confidential and
in accordance with Data Privacy Act 2012. Thank you!
Mariel Rose P. Imperial

Research Leader
Name of the Respondent: (Optional)
1. What is your age?

A. 20-25 years old
B. 26-30years old
C. 31 and above
2. How long have you been working as a professional accountant?

A. 1-5 years
B. 6-10 years
C. 11 and above
3. What did you choose as your specialization in accounting?

A. Auditor
B. Tax Accountant
C. Financial Accountant
D. Management Accountant
E. Financial Analyst
F. Academe
G. Others
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Directions: Below are statements to measure the application level of the New Code Ethics on the
practice of professional accountants in San Pedro City, Laguna. Choose wisely on the choices
given. Use the following as your guide.
Categorical Numerical Interpretation Verbal Description

Verbal Response
Response
Always 4 Full Compliant I experience the indicator 76-100% of the time.
Often 3 Substantial Compliant I experience the indicator 51-75% of the time.
Rarely 2 Partial Compliant I experience the indicator 26-50% of the time.

Never 1 Noncompliant I experience the indicator 1-25% of the time.
STATEMENTS 4 3 2 1
POTENTIAL CONFLICTS
1) I do not feel pressure in work that resulted in performing
ethical behavior.
2) I accepted any task willingly.
3) I will report any threat that might happen inside our
workplace to our management.
4) I do not compromise any professional or business
judgement because of bias, conflict of interest, or undue
influence of others.
PREPARATION AND REPORTING OF INFORMATION
5) I have never experienced threats from our higher-ups and
clients.
6) I agree that threats are the reasons for professional
accountants’ unethical acts.
7) I have never prepared financial or management reports
that are against my will.
8) I serve my clients and employ professional organizations
to exercise sound judgment in undertaking professional
activities.
9) I apply awareness and an understanding of relevant
technical, professional, and business developments to
develop and maintain the capabilities to perform
competently to satisfy my clients.
10) I know and understand any inadvertent disclosure of any
information from my client to anyone in any case.
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ACTING WITH SUFFICIENT EXPERTISE
11) My professionalism in my work is the reason for me to
work ethically.
12) I have given a task with sufficient time to perform it and
able to finish it.
13) I personally agree that to eliminate or reduce threats is to
establish a strong safeguard policy in the workplace.
14) I diligently encompass the responsibility to act in
accordance with the requirements of a task carefully,
thoroughly and on a timely basis.
15) I imply truthfulness and fairness in the tasks assigned to
me.
16) I do undertake any activity if a circumstance or
relationship duly influences my professional judgment
regarding that activity.
FINANCIAL INTEREST
17) I have correctly computed and made financial reports.
18) I never manipulated some of the documents (money-
related) just to have extra earnings.
19) I never agreed on increasing my salary in exchange for
doing them favors in terms of financial reports.
20) I do not bring any form of disrespect to my profession.
INDUCEMENTS
21) If I have experienced receiving a client's gift and never
use it as a threat to influence my judgement or my
decision-making.
22) I have complied with my head officer’s inducements and
give good judgement regarding the client’s matter.
23) I gave inducements to my clients not to receive a good
performance evaluation but only as a token of
appreciation.
24) I do not omit or obscure any information/s that can cause
misleading data in exchange for something.
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APPENDIX D
COMPUTATION OF RAW DATA
Age
Frequency Percent Valid Percent Cumulative Percent
Valid 20-25 years old 19 27.1 27.1 27.1
26-30 years old 32 45.7 45.7 72.9
31 years old and
19 27.1 27.1 100.0
above
Total 70 100.0 100.0
Years of Experience
Valid 1-5 years 32 45.7 45.7 45.7
6-10 years 31 44.3 44.3 90.0
11 years and above 7 10.0 10.0 100.0
Total 70 100.0 100.0
Specialization in Accounting
Valid Auditor 8 11.4 11.4 11.4
Tax Accountant 8 11.4 11.4 22.9
Financial Accountant 16 22.9 22.9 45.7
Management Accountant 11 15.7 15.7 61.4
Financial Analyst 18 25.7 25.7 87.1
Academe 9 12.9 12.9 100.0
Total 70 100.0 100.0
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Descriptive Statistics
N Minimum Maximum Sum Mean Std. Deviation
Q1 70 1.00 4.00 222.00 3.1714 .90043
Q2 70 1.00 4.00 228.00 3.2571 .81090
Q3 70 2.00 4.00 228.00 3.2571 .77433
Q4 70 1.00 4.00 241.00 3.4429 .75442
Q5 70 1.00 4.00 219.00 3.1286 .93128
Q6 70 2.00 4.00 242.00 3.4571 .62983
Q7 70 1.00 4.00 226.00 3.2286 .80165
Q8 70 2.00 4.00 246.00 3.5143 .60775
Q9 70 2.00 4.00 243.00 3.4714 .65323
Q10 70 1.00 4.00 249.00 3.5571 .71497
Q11 70 1.00 4.00 242.00 3.4571 .77433
Q12 70 1.00 4.00 233.00 3.3286 .86345
Q13 70 1.00 4.00 240.00 3.4286 .73369
Q14 70 2.00 4.00 237.00 3.3857 .72817
Q15 70 1.00 4.00 243.00 3.4714 .77500
Q16 70 1.00 4.00 239.00 3.4143 .69141
Q17 70 1.00 4.00 233.00 3.3286 .69619
Q18 70 2.00 4.00 240.00 3.4286 .69306
Q19 70 1.00 4.00 239.00 3.4143 .69141
Q20 70 1.00 4.00 239.00 3.4143 .73214
Q21 70 1.00 4.00 232.00 3.3143 .82608
Q22 70 2.00 4.00 243.00 3.4714 .65323
Q23 70 1.00 4.00 224.00 3.2000 .89443
Q24 70 2.00 4.00 251.00 3.5857 .62538
Valid N (listwise) 70
78
Kn
Descriptive Statistics
N Minimum Maximum Sum Mean Std. Deviation
Potential 70 1.50 4.00 229.75 3.2821 .68090
Preparation 70 1.83 4.00 237.50 3.3929 .58224
Acting 70 1.50 4.00 239.00 3.4143 .68733
Financial 70 1.50 4.00 237.75 3.3964 .65038
Inducement 70 2.00 4.00 237.50 3.3929 .64770
Valid N (listwise) 70
Tests of Normality
Kolmogorov-Smirnova Shapiro-Wilk
Statistic df Sig. Statistic df Sig.
Potential .183 70 .000 .890 70 .000
Preparation .166 70 .000 .889 70 .000
Acting .243 70 .000 .817 70 .000
Financial .223 70 .000 .826 70 .000
Inducement .240 70 .000 .831 70 .000
a. Lilliefors Significance Correction
79
Kn
Test Statisticsa,b
Potential Preparation Acting Financial Inducement
Chi-
.439 .173 .362 .878 1.117
Square
df 2 2 2 2 2
Asymp.
.803 .917 .834 .645 .572
Sig.
a. Kruskal Wallis Test

b. Grouping Variable: Years of Experience
Test Statisticsa,b
Chi-
1.037 1.364 .465 .327 3.405
Square
df 2 2 2 2 2
Asymp.
.595 .506 .793 .849 .182
Sig.
b. Grouping Variable: Age
Test Statisticsa,b
Chi-Square 3.282 1.808 1.635 2.762 4.112
df 5 5 5 5 5
Asymp.
.657 .875 .897 .737 .533
Sig.
b. Grouping Variable: specialization in accounting
80
Kn
CURRICULUM VITAE
Name: Mariel Rose P. Imperial

Address: St. John Subdivision, Brgy. Ibaba, Sta. Rosa, Laguna
Contact Number: 0977 481 1914
E-mail Address: maryhelrose@gmail.com
Personal Data:
Height: 152 cm
Weight: 48 kg.
Birthdate: February 18, 1999
Age: 22 years old
Birthplace: Daet, Camarines
Citizenship: Filipino
Religion: Roman Catholic
Father’s Name: Joselito P. Imperial
Mother’s Maiden Rosa T. Pajo
Name:
Educational Attainment:
Grade School:
Jose Juan Serapio Elementary School 2006-2012
Junior High School:
Jacobo Z. Gonzales Memorial National High 2012-2016
School
Senior High School:
University of Perpetual Help System-Laguna 2016-2018
College:
San Pedro College of Business Administration 2018- present
Certification and Seminars:

CREOTECH INC. PHILIPPINES
Work Immersion
2018
INTRODUCTION: Hack from Home Seminar
2020
The Leader in You: How Youth Can Develop Their Leadership Skills Seminar
2020
81
Kn
CURRICULUM VITAE
Name: Jhoee Razelle M. Oliva

Address: #3 Jupiter St. Phase 1, Brgy. Pacita 2, City of San
Pedro, Laguna
E-mail Address: jrazoliva@gmail.com
Personal Data:
Height: 153cm
Weight: 57 kg.
Birthdate: April 22, 2000
Age: 21 years old
Birthplace: San Pablo City, Laguna
Religion: Roman Catholic
Father’s Name: Elbert E. Oliva
Mother’s Maiden Name: Edna R. Moreno
Grade School:
Santisimo Rosario Elementary School 2006-2012
Junior High School:
Liceo De San Pablo 2012-2013
Pacita Complex National High School 2013-2016
Senior High School:
Pacita Complex Senior High School 2016-2018
College:
San Pedro College of Business Administration 2018-present
Certifications and Seminars:

Best Research Award in the study "A COMPARATIVE STUDY ON THE
BIOSORPTION ACTIVITY OF JACKFRUIT AND POMELO PEELS AS
BIOSORBENTS IN REMOVING HEAVY METALS IN LAGUNA LAKE"
(2018)
Certificate of Participation in a seminar "THE LEADER IN YOU: HOW YOUTH
CAN DEVELOP THEIR LEADERSHIP SKILLS" (2020)
82
Kn
CURRICULUM VITAE
Name: Janice I. Ruaza
Address: Maryland Homes I Brgy. Landayan, Laguna
E-mail Address: ruazajanice20@gmail.com
Personal Data:
Height: 5’2
Weight: 47 kg.
Birthdate: May 20, 2000
Age: 20 years old
Birthplace: Lying-In, Makati City
Religion: Christian
Father’s Name: William B. Ruaza
Mother’s Maiden Name: Jolisa S. Ibay
Grade School:
Hen. Pio del Pilar Elementary School 2012-2013
Junior High School:
Bangkal High School 2015-2016
Senior High School:
Lyceum of Alabang 2017-2018
College:
San Pedro College of Business Administration 2018- present
Certifications and Seminars:

Certificate of Participation on Speak out: Conquer your fear in Public Speaking.
Certificate of Completion in Values Orientation in Classroom Education
Certification of Registration of Student Member of Royal Institute of Management
Certificate of Attendance in Encounter Retreat
Certificate of Completion of Post Encounter
83

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SAN PEDRO COLLEGE OF BUSINESS ADMINISTRATION

APPLICATION LEVEL OF THE NEW CODE OF ETHICS

Imperial, Mariel Rose P.

San Pedro City, Laguna

unmotivated. He guide us and take care of us whenever we stayed up late at night.

on how to change our questions on the right.

in regards to the process of making research.

Table Title Page

2 Demographic Profile of the Respondents in terms of Age 46

Demographic Profile of the Respondents in terms of Years of Professional

4 Demographic Profile of the Respondents in terms of Specialization 48

Ethical Factors Affecting the Practice of Professional Accountants in terms of

Ethical Factors Affecting the Practice of Professional Accountants in terms of

Ethical Factors Affecting the Practice of Professional Accountants in terms of

Ethical Factors Affecting the Practice of Professional Accountants in terms of

Ethical Factors Affecting the Practice of Professional Accountants in terms of

Summary of Ethical Factors Affecting the Practice of Professional

11 Normality Test Using Kolmogorov-Smirnov and Shapiro-Wilk Test 58

12 the New Code of Ethics on the Practice of Professional Accountants When 59

Grouped According to Years of Professional Experience

Kruskal-Wallis H test For Significant Difference on the Application Level of

13 the New Code of Ethics on the Practice of Professional Accountants When 60

Grouped According to Age

Kruskal-Wallis H test For Significant Difference on the Application Level of

the New Code of Ethics on the Practice of Professional Accountants When

Figure Title Page

1 IPO Conceptual Framework Model 08

Appendix Title Page

D Computations of Raw Data 77

THE PROBLEM AND ITS SETTING

provides the groundwork for a preemptive warning.

going down a slippery slope, and setting a bad example.

According to CIMA (2018), all professional accountants establish the fundamental

profession in practice (Deakin University & Griffith University, 2021).

The International Ethics Standards Board for Accountants (IESBA) is an international

improvements to the AICPA Code of Professional Conduct. In addition, when performing

International Certified Public Accountants (2021).

Background of the Study

that could create a conflict of interest (Chen, 2020).

According to the University of West Florida (2017), ethics requires professionals to

they perform the right ethics needed in their workplace?

ethical misconduct committed by professional accountants gravitated to have a broader impact

and be viewed as the reason to damage society.

and regulations (NOCLAR) committed by a client or employer.

Statement of the Problem

b) Years of professional experience;

b) Preparation and reporting of information

c) Acting with sufficient practice

Accountants in San Pedro City, Laguna?

practice of professional accountants according to their demographic profile?

In this study, the researchers will use the hypothesis below:

hear an ethical problem in what someone says (Bragg, 2020).

understand because of ethical sensitivity. Ethical insensitivity is a sense of an individual's or

hampered by other factors.

The second component of the FCM is ethical judgment or decision-making, a deliberative

action (Robichaux, 2017).

interest in terms of income or wealth, protection of one's organization or community, or self-

has a three-part process: the input, process, and output.

gender, years of professional experience, and specialization.

IPO Conceptual Framework Model

findings to the importance of knowing the application level of the ethics.

Scope and Limitation

questionnaire, which is prepared by researchers.