Student and Practitioner Cheating: A Crisis for the Accounting Profession

Abstract

In this essay, we propose that the prevalence of cheating by accounting students and serial cheating by accounting practitioners at Big-4 accounting firms are related. Our model of this problem suggests that students who cheat in school become practitioners who cheat in practice, and practitioners, in turn, model dishonest behavior for students. We propose that this vicious cycle of dishonesty poses a threat to the public’s trust in the accounting profession, and this crisis calls for drastic measures, both in academia and in practice, akin to measures like the Sarbanes–Oxley Act of 2002. As an honorable profession, dishonesty cannot be tolerated. Brief overviews of the prevalence of cheating, both by students and by Big-4 accounting practitioners are presented. Suggestions are included for a three-prong approach by accounting stakeholders to reduce this egregious ethical problem—a problem that, we suggest, is causing a new crisis in confidence for the accounting profession.

1. A Crisis for the Accounting Profession

Following the accounting scandals that occurred around the end of the twentieth century, the public’s trust in the accounting profession waned. Accounting scandals (e.g., Enron, WorldCom, Merck, Xerox, and Adelphia) and the related downfall of one of the world’s largest public accounting firms, Arthur Andersen, eroded the public’s confidence in the honesty and ethical standards of the accounting profession (Coleman et al., 2004). In a Gallup Poll Survey of Honesty and Ethics of Professions conducted from 8 to 10 February 2002, only 32 percent of the adult public regarded accountants as having high to very high rates of honesty (Jones, 2002). A recent ranking of the most trusted professions ranked accountants only 17th out of 20 (Mushtaque, 2023).

Recent cheating scandals by accounting students and practitioners are reminiscent of two decades ago and are a cause for current-day alarm (cf., Cooke, 2024; PCAOB, 2024a; Boulianne et al., 2023). This time around, we observe a rather contained public and media outcry and an absence of regulatory changes. By establishing a relation between cheating in academia and ethical misconduct in practice, this essay aims to sound the alarm on what we see as a brewing crisis in accounting.

The accounting profession must have the public’s confidence. That confidence is derived from a belief that accountants and auditors are ethical and that their work is trustworthy. Without that confidence, the work of accountants and auditors is worthless. For example, reliable financial statements enable investors to know recent financial performance, estimate future performance, and make good investment decisions. Reliable financial statements enable lenders to estimate the ability of borrowers to pay back their loans and thereby make good lending decisions. If the accounting profession fails to maintain the highest ethical standards, then the profession runs the risk of losing the public’s trust (cf., Ariail et al., 2024b, 2020; Malz, 2011; Smith, 2003).

A deterioration of the ethical image of accountants will increase the risk that the public will lose confidence in the profession. Further, if investors, lenders, and others cannot trust the work of accountants, then this will cause chaos in the marketplace, as investors, lenders, and others will be severely hampered in their ability to manage their financial matters. In other words, how can they distinguish between good and bad investments? How can they determine what is a good or bad lending decision? Increased risk and poor financial management will be inevitable if accountants lack ethical character, and thus, their work becomes unreliable (cf., Hirawati et al., 2021; Ariail et al., 2020; Malz, 2011; Smith, 2003).

The erosion of the public’s perception of the honesty and ethics of the accounting profession in the early 2000s resulted from the unethical conduct of a relatively small number of accountants and CPAs. These were acts that Michael Raymer, president of the Canadian Institute of Chartered Accountants, characterized as “greed unfettered by integrity” (Voynich, 2003). Brewster observed the following: “Since the collapse of Enron in late 2001, the accounting profession has forfeited what was nearly unconditional respect from the public” (Brewster, 2003, p. 4). A concentration on moral motivation (core values) was recommended by Voynich (2003), the chair-elect of the American Institute of Certified Public Accountants (AICPA), as the solution to the CPAs’ ‘crisis in confidence’:

The events of the last eighteen plus months have focused a bright light on the profession’s core values: integrity, competence and objectivity. Unfortunately, the failures have rightly caused the public to ask if we have been true to those core values. For the first time in my memory our credibility has been called into question and that is the most troubling consequence of these recent events. In point of fact, our core values are actually the solution and we have to do whatever it takes to live up to those values and to instill them in the next generation of CPAs. The real solution to our crisis in confidence rests with the rank and file CPA. Each CPA has a significant influence in their professional and personal community and the best opportunity to shape opinion. How we live our values on a daily basis will have more impact, good or bad, than any high profile CPAs. I am more concerned about those who make a difference than about those who make headlines.

(Voynich, 2003)

While the public’s trust in the accounting profession has perhaps improved over the decades since the passage of the Sarbanes–Oxley Act of 2022 (SOX, 2002), we suggest that the recent cheating scandals at the Big-4 accounting firms pose a new risk to the profession and to accounting academia. If accounting practitioners are to “make a difference” in achieving and maintaining public trust in the profession’s honesty and ethics, they must adhere to high levels of moral behavior. The value of honesty is the key value of the accounting profession (cf. Ariail et al., 2020; Mintz & Miller, 2023; Cheffers & Pakaluk, 2007).

The Distionary.com definition of honesty includes “truthfulness, sincerity or frankness” and “freedom from deceit or fraud.” Regarding truthfulness, Cheffers and Pakaluk (2007) stated, “…that the distinctive task of an accountant, as a professional, is to seek and declare the truth about the financial condition of a company in order to provide for the conditions of trust in a modern, market economy” (p. 79). The acceptance of accounting work products, for both internal and external use, depends on perceptions that the numbers and the financial story they tell are true. Thus, accountants must be honest in what they say and report.

Following the last major crisis of confidence in the accounting profession, the U.S. Congress stepped in and passed the Sarbanes–Oxley Act of 2002. Many in accounting academia and in the profession did their part to re-establish the emphasis on ethics in accounting. The call to do more was stated as follows:

Leaders in the accounting profession and in academe should focus on calling individuals to excellence. By presenting the importance of high ethical standards, by teaching the importance of personal integrity, we summon current and future accountants to his or her nobility. In doing so, we ensure the future of the accounting profession, which will continue its historic role of fostering the success of the economy and the nation.

(Smith, 2003, p. 49)

2. Professional Guidance

Akin to honesty is integrity, which is a moral code that requires one to do the right thing. The ethical codes of the premier accounting organizations such as the Institute of Management Accountants (IMA, 2017), the Institute of Internal Auditors (IIA, n.d.), the International Federation of Accountants (IFAC, 2024), and the American Institute of Certified Public Accountants (AICPA, 2014) emphasize that accounting professionals must practice with integrity, which includes them being honest and thus not deceptive. In complying with the ethical standard of integrity, the IMA (2017) in part states that members should

• Refrain from engaging in any conduct that would prejudice carrying out duties ethically.
• Abstain from engaging or supporting any activity that might discredit the profession.
• Contribute to a positive ethical culture and place integrity of the profession above personal interest (IMA, 2017, p. 2).

According to the IIA, “the integrity of internal auditors establishes trust and thus provides the basis for reliance on their judgment” (IIA, n.d.). The first fundamental principle of the IMA is integrity: “A professional accountant shall comply with the principle of integrity, which requires an accountant to be straightforward and honest in all professional and business relationships” (IMA, 2017). Further, the IFCA’s Handbook of the International Code of Ethics for Professional Accountants in part states the following:

• A professional accountant shall comply with the principle of integrity, which requires an accountant to be straightforward and honest in all professional and business relationships.
• Integrity involves fair dealing, truthfulness, and having the strength of character to act appropriately, even when facing pressure to do otherwise or when doing so might create potential adverse personal or organizational consequences (IFAC, 2024, p. 20).

And integrity is a principle in the AICPA Code of Professional Conduct (AICPA, 2014):

Integrity principle: to maintain and broaden public confidence, members should perform all professional responsibilities with the highest sense of integrity.

• Integrity is an element of character fundamentals to professional recognition. It is the quality from which the public trust derives and the benchmark against which a member must ultimately test all decisions.
• Integrity requires a member to be, among other things, honest and candid within the constraints of client confidentiality. Service and the public trust should not be subordinated to personal gain and advantage. Integrity can accommodate the inadvertent error and an honest difference in opinion; it cannot accommodate deceit or the subordination of principle.
• Integrity is measured in terms of what is right and just. In the absence of specific rules, standards, or guidance or in the face of conflicting opinions, a member should test decisions and deeds by asking: “Am I doing what a person of integrity would do? Have I retained my integrity?” Integrity requires a member to observe both the form and the spirit of technical and ethical standards; the circumvention of those standards constitutes the subordination of judgment (AICPA, 2014, p. 5).

In response to the widespread Big-4 cheating scandals, in 2023, the International Ethics Standards Board for Accountants (IESBA) established The Firm Culture and Governance Working Group, which had the following objectives:

(a) Gather an understanding of culture and governance and their impact on compliance with ethics and independence requirements in accounting firms and, where applicable, their networks (“firms”); (b) Review the extant provisions on organizational firm culture in the Code and consider whether the Code should be further strengthened to reinforce a robust culture of ethical behavior within firms; (c) Raise awareness of the issues relating to and the importance of governance and ethical culture within firms through outreach activities; (d) Develop a report and recommendations to the IESBA.

(IESBA, 2025, pp. 7 & 8)

The 48-page report, which was issued in February 2025, recommends that the IESBA promulgate a new standard that “…would promote the establishment of an ethical culture within firms through the development of strong ethical leadership and a robust culture and governance framework that embeds strong ethical values”. The nine standard-setting objectives indicated in the report include the importance of “performance management that incentivizes ethical behavior, including rewards and recognition” and “… education and training programs that highlight the importance of ethical behavior” (IESBA, 2025, pp. 20 & 21).

3. The Vicious Cycle of Cheating

We suggest that accounting students who cheat in college may be more apt to cheat in accounting practice. Cheating by accounting practitioners sets unethical examples for future practitioners, which in turn encourages cheating in school. In other words, cheating in school has negative ramifications for cheating in practice, and cheating in practice models cheating for students. The Merriam-Webster Dictionary defines a vicious cycle as “a chain of events in which the response to one difficulty creates a new problem that aggravates the original difficulty” (Merriam-Webster, 2024). The term “vicious cycle” has been used to describe various feedback loops. For example, Eagly and Koening (2021) suggest that the stereotyping of social roles perpetuates a vicious cycle that hinders social mobility. From an ethical perspective, van Nunspeet and Ellemers (2024) suggest that people disagreeing with the ethical values and choices of others may disrupt a positive feedback loop that prevents them from acknowledging and addressing their own ethical shortcomings. According to Neville (2012), “… imagine[s] a vicious cycle, in which a lack of generalized trust promotes cheating, and the prevalence of cheating further diminishes generalized trust” (p. 344). Figure 1 presents our proposed “Vicious Cycle of Cheating” model for unethical behavior by students and practitioners.

4. Student Cheating

Academic dishonesty in the form of cheating is an ongoing international problem. Self-reported cheating by college students is high, but it is even higher when students report their knowledge of cheating by others. With the move to online instruction during the COVID pandemic, an uptick in cheating was reported (e.g., Havranek, 2020; Loeb, 2021; Lungariello, 2021; Sirdeshmukh, 2021). In 2020, the International Center for Academic Integrity (ICAI, 2020) found that 29.3 percent of college students self-reported cheating. Williams (2022) reported that more than half of the students at higher education institutions in the United Kingdom (U.K.) reported cheating by themselves or others. And Anitha and Sundaram (2021) found an almost unanimous (93.4 percent) prevalence of some form of cheating by students in India.

In a study by McCabe et al. (2006), 56 percent of graduate business students self-reported cheating. Monahan and Shah (2023) compared the online grades of U.S. business students taking a capstone course under two conditions: with and without their computer browsers being locked down. These conditions were used as a proxy measure of cheating. Their results indicated that those whose browsers were not locked down, that is, those who had a greater opportunity to cheat, had grades one and a half to two times higher than those whose browsers were locked down. Neto et al. (2024) investigated self-reported cheating by accounting students in Brazil. They found that from 11 percent to 57 percent of students indicated that they had either cheated themselves or had observed others cheating.

The use of artificial intelligence (AI) and the availability of cheating enabling websites may be increasing the prevalence of cheating or at least helping to normalize this unethical behavior. With accounting students in Jordan and accounting and business students in the U.K., Alshurafat et al. (2024) and Kelly et al. (2022), respectively, found versions of the fraud triangle (Cressey, 1953/1973) applicable to cheating. Alshurafat et al. (2024) indicated “…that ChatGPT presents an accessibility to cheat, as it caters to the three components of the fraud triangle: opportunity, rationalization and pressure” (p. 283).

Kelly et al. (2022) found that responses by students who cheated by paying for the services of online websites (contract cheating) mapped well onto each of the four components of Wolfe and Hermanson’s (2004) fraud diamond, which added the component of capability to the three components of the fraud triangle. Of the four components, the authors suggested that the component of “…rationalization may supersede all other aspects of the fraud diamond” (p. 95). The weighing of the cost of cheating against the benefits of cheating was found by Boyle et al. (2016) to be a common rationalization by students for cheating. And Ariail et al. (2024a) found that 10 to 37 percent of accounting students rationalized cheating based on convoluted interpretations of one or more of six ethical theories.

In a meta-analysis of 38 studies with a sample size of 24,181, Zhao et al. (2022) investigated the effect of perceived peer cheating on student cheating, commonly known as the peer cheating effect. These researchers stated that “when compared to all factors known [to] be significantly associated with students’ academic cheating, this effect size was the strongest” (p. 13). Thus, the perception that everyone is cheating, which reflects the theory of ethical relativism (cf. McCombs School of Business, n.d.; Velasquez et al., 1992) where cheating becomes a social norm, works to increase the prevalence of cheating.

Therefore, the unethical behavior of student academic cheating may not have abated since COVID. Instead, a new uptick in student cheating may result from the ready availability of AI and online cheating resources. Also, by using a cost/benefit type analysis, which is reflected in the theory of ethical egoism (cf. Holmes, 1998), students may more easily rationalize cheating behaviors.

With a sample of undergraduate and graduate business students, Ariail et al. (2015) found that 57.1 percent of them did not think that cheating while in college was related to cheating in the workplace. More recently, with a sample of business students that included undergraduate and graduate accounting majors, Ariail et al. (2024a) found an even larger majority (62.5%) of students who did not believe that unethical conduct in school impacted unethical conduct in the workplace. Nevertheless, research (e.g., Brodowsky et al., 2020; Guerrero-Dib et al., 2020; Ma, 2013; Rujoiu & Rujoiu, 2014; Sims, 1993) has supported a college/workplace cheating association. We posit that the professionals at these Big-4 firms who cheated on tests may have also cheated while in school. Had their experiences in school primed them for cheating when they became practitioners? That is, the viscous cycle where cheating in school results in cheating in practice which, by example (modeling), negatively impacts the ethics of future professionals in training.

We suggest that two theories from the field of psychology, Social Learning Theory and Value Self-Confrontation Theory, have relevance to cheating by accounting students. Social Learning Theory, developed by Bundura (1971), is defined, in part, as follows in the APA Dictionary of American Psychology:

…learning is largely due to modeling, imitation, and other social interactions. More specifically, behavior is assumed to be developed and regulated by external stimulus events, such as the influence of other individuals. …Indeed modeling is one of the most pervasive and powerful means of transmitting patterns of behavior: Once observers extract the rules and structure underlying the modeled activities, they can generate new patterns of behavior that conform to those properties but go beyond what they have seen or heard, expanding their knowledge and skills rapidly without having to go through the process of learning response consequences.

(APA Dictionary of American Psychology, n.d.)

Research on Social Learning Theory has associated student cheating with perceptions of peer cheating. Hendy et al. (2021) found that students who perceived that their peers were cheating self-reported higher incidences of cheating. Stogner et al. (2013) reported that variables associated with social learning—learning by observing—predicted online cheating. And as previously indicated, Zhao et al. (2022) found that, among known factors associated with cheating, the perception of peer cheating was the strongest.

In addition to ethical behavior being influenced by external observations of peers, observing the behavior of role models is also important. Using the lens of Social Learning Theory, Brown and Treviño (2014) found that when leaders had an ethical role model, they were more apt to be perceived as ethical leaders by their subordinates. In a study of negotiation tactics of college students, Perry and Nixon (2005) found that “role models can be highly influential in conveying ethical standards” (p. 25). Similarly, Moberg (2000) indicated that role models can act as moral exemplars. On the other hand, Baden’s (2014) findings suggested that negative role models “reduce self-efficacy in the ethical business domain... which may present a barrier to ethical business behavior” (p. 166).

Rokeach (1973), a seminal values researcher, identified a set of universal personal values. His research indicated that individuals tend to change their value priorities, including the priority given to moral values, to align more closely with those of an esteemed group. Versions of Rokeach’s Value Self-Confrontation methodology have been used in at least 39 studies (Ariail et al., 2024b) to effectuate changes in value priorities (e.g., Maio et al., 2009; Mayville, 1997; Grube et al., 1994) and related changes in attitudes and behaviors (Arieli et al., 2014; Ball-Rokeach et al., 1984; Conroy, 1979; da Costa Diniz, 2016; Schwartz & Inbar-Saban, 1988). From an accounting perspective, using the values developed by Rokeach (1973) and Ariail et al. (2021) related the four most important values of certified public accounting leaders to ethical values included in the AICPA Code of Professional Conduct (AICPA, 2014). Ariail et al. (2021) used the ethical value priorities of this esteemed group to successfully effectuate both the short-term and long-term value priorities of accounting students to increase the importance that accounting students gave to four of the ethical values of the accounting profession: honest, responsible, capable, and courageous.

Therefore, both the theories of Social Learning and Value Self-Confrontation suggest that role models, especially those from an esteemed group, can influence the ethical values and behaviors of students. We suggest that the ethical behavior of accounting students may be modeled based on that of accounting practitioners, especially practitioners at the Big-4 firms which students may see as the “gold standard” (IRS, 2005) that they should emulate. So, what are the cheating behaviors being modeled by Big-4 practitioners? What are the ethical examples being communicated to accounting students?

5. Practitioner Cheating

When partners and CPAs at the Big-4 firms fail to abide by the highest ethical standards, they set unethical examples for students who will soon enter the accounting profession. While championing the need for honesty in accounting work, their actions must match their words. We suggest that prominent accounting firms, like the Big-4, set ethical standards that can impact the practice of smaller firm practitioners and those in industry. In addition, of great importance is the impact these firms may have on the ethics of accounting students. This “gold standard” perspective was expressed by IRS Commissioner Mark Everson regarding the KPMG tax shelter fraud (cf., DOJ, 2005) that resulted in a $456 million penalty:

Today’s actions demonstrate our resolve to hold accountable those who play fast and loose with the tax code. At some point such conduct passes from clever accounting and lawyering to theft from the people. We simply can’t tolerate flagrant abuse of the law and professional obligations by tax practitioners, particularly those associated with so-called blue chip firms like KPMG, that by virtue of their prominence set the standard of conduct for others. Accountants and attorneys should be the pillars of our system of taxation, not the architects of its circumvention.

(IRS, 2005, 29 April, para. 3)

In auditing, the opinions of accounting professionals are only as good as the public’s and management’s trust in them. Trust that auditors (internal and external) have performed their tasks with integrity, that Generally Accepted Auditing Standards have honestly been followed, and that the financial statements of the audited entity have been presented in accordance with Generally Accepted Accounting Principles. If auditors are working in unethical environments where cheating on continuing professional education tests and, even more egregiously, cheating on the CPA exam are normalized behaviors, how can the public trust the work product of auditors?

Over the past six years, the Big-4 accounting firms of KPMG, PwC, EY, and Deloitte have been censored and penalized by the PCAOB and the SEC for unethical conduct involving their accounting professionals cheating on online administered training tests. These tests included continuing professional education exams required for CPAs and chartered accountants. Perhaps, most egregiously, the sharing of test answers by accounting professionals in the U.S. included cheating on the ethics portion of the CPA exam. Regulators determined that Big-4 firm cheating violations included the AICPA’s Code of Professional Conduct Rule 1.400.001 regarding acts discreditable to the profession (AICPA, 2014), the PCAOB’s Quality Control Standard QC 20.01 (PCAOB, n.d.-b), and the PCAOB’s Rule 3500T (PCAOB, n.d.-a) regarding ethics. While these violations were not directly related to Generally Accepted Accounting Standards or Generally Accepted Auditing Standards, we suggest that they are indicative of a lack of integrity that can undermine the public’s trust in the accounting profession. Brief summaries of the test cheating that occurred at each of the Big-4 firms follow.

5.1. KPMG

On 17 June 2019, the Securities and Exchange Commission (SEC, 2019) fined KPMG LLP (KPMG) USD 50 million for unethical conduct in illegally obtaining and acting on confidential PCAOB audit information, and, pertinent to the present study, for widespread test cheating by audit professionals and partners. Answers to internal training tests were shared by all levels of audit personnel, including lead audit partners. When KPMG investigated the cheating, partners tried to conceal their involvement. In addition, the software used to administer internal tests were manipulated to adjust the pass rate from 70 percent to 25 percent (SEC, 2019).

Test cheating continued. On 13 September 2021, the PCAOB (PCAOB, 2021) censured KPMG Australia and penalized them $450,000 for violations like those found by the SEC (2019). In this case, 1131 professionals were sanctioned by the firm for sharing answers on internal training tests. Of these, 277 were audit personnel (PCAOB, 2021). Test cheating continued. In another cheating scandal involving improper answer sharing, the PCAOB (PCAOB, 2022b) on 6 December 2022 censured and fined KPMG LLP (United Kingdom) USD 2 million. In this case, hundreds of professionals at KPMG U.K. and at an affiliate in India cheated on online exams administered throughout 2018–2021.

Test cheating again continued. On 10 April 2024, the PCAOB (PCAOB, 2024a) censured and fined KPMG Netherlands $25 million for cheating on internal tests by sharing answers and for the group taking of individual tests. These internal tests included cheating on exams required for charted accountants in the Netherlands. In this case, hundreds of professionals who cheated from 2017 to 2022 included senior firm leaders who also impeded the PCAOB’s investigation by lying about a whistleblower’s report. The PCAOB noted that answer sharing at KPMG was indicative of unethical tones at the top.

5.2. PwC

On 24 February 2022, the PCAOB (PCAOB, 2022a) censured PricewaterhouseCoopers LLP (PwC) Canada for ethics and quality control violations regarding internal exam cheating. The firm was fined USD 750 thousand and was required to take remedial actions. PwC’s investigation found that between 2016 and 2020, more than 1200 professionals improperly shared answers on internal training tests. Answer sharing was accomplished using the following methods: Shared Drives, emails, hard copies, and verbal transmissions (PCAOB, 2022a). “The Shared Drives contained answers for at least 46 of the Firm’s 55 mandatory Assurance tests, as well as answers to some mandatory Firm-wide tests containing content concerning professional integrity and professional independence” (PCAOB, 2022a, p. 5). The unethical sharing of test answers included tests used to meet continuing professional education requirements for CPAs (PCAOB, 2022b).

5.3. EY

On 28 June 2022, the Securities and Exchange Commission (SEC, 2022b) censured and penalized Ernst & Young (EY) USD 100 million for unethical conduct by audit personnel in multiple offices who cheated on internal tests. For nine months, EY lied to the SEC by indicating that there was no ongoing cheating. Nevertheless, EY’s internal investigation found that by using answer keys received from colleagues, 49 “…audit professionals in multiple offices cheated on CPA ethics exams” (SEC, 2022b, p. 6). By sharing test answers, many audit professionals also cheated on continuing professional education courses; a total of 91 of them did so after being warned by the firm’s chair of the SEC’s enforcement action against KPMG. EY’s cheating investigation covered the years of 2017–2021. In addition, “from 2012 to 2015, over 200 EY audit professionals across the country exploited a software flaw to pass exams while answering a small percentage of questions correctly” (SEC, 2022b, p. 3). Moreover, in violation of EY’s Code of Ethics, professionals who knew about the cheating did not report it. “Many of these professionals attributed their silence to a lack of appreciation that sharing exam answers constituted cheating and violated EY’s Code of Conduct, and a desire to avoid getting colleagues in trouble” (SEC, 2022b, p. 6). In addressing the egregious nature of the cheating by EY professionals, Gurbir S. Grewal, the SEC’s enforcement director, stated the following:

This action involves breaches of trust by gatekeepers within the gatekeeper entrusted to audit many of our Nation’s public companies. It is simply outrageous that the very professionals responsible for catching cheating by clients cheated on the ethics exams of all things and it’s equally shocking that Ernst & Young hindered our investigation of this misconduct. This action should serve as a clear message that the SEC will not tolerate integrity failures by independent auditors who choose the easier wrong over the harder right.

(SEC, 2022a, para. 2)

5.4. Deloitte

From 2019 to 2023, over 200 professionals, including two partners, at Imelda & Rekan, the Indonesian affiliate of Deloitte Touch Tohmatsu Limited (DT), were found to have cheated on internal training tests. This cheating scandal, which involved various forms of answer sharing, took place despite partners being repeatedly warned that it was unethical and improper to share exam answers. In 2023, the ethical violations were reported by the firm to the PCAOB. On 10 April 2024, the PCAOB found that Imelda & Rekan had violated the standards regarding quality controls, technical training, and integrity (cf. QC Section 20). The firm was censored, and a USD 1 million penalty was imposed (PCAOB, 2024b).

In a similar ethics violation, on 10 April 2024, Navarro Amper & Co., DT’s affiliate in the Philippines, was also censored, and a USD 1 million penalty was imposed by the PCAOB (2024b) for the improper sharing of internal training answers during 2017–2019. Almost all the audit partners and other audit professionals cheated. This unethical behavior was facilitated by the national professional practice director and by the audit practice director who e-mailed test answers, including answers to tests used for continuing professional education, to audit partners. Thus, unethical tones at the top by these top-level professionals “…enabled widespread improper answer sharing…” (PCAOB, 2024c, p. 5).

6. How Accounting Educators Can Respond

Cheating scandals in accounting education are cause for serious concern. Burke et al. (2007) suggested that strong responses, akin to the Sarbanes–Oxley (SOX, 2002) measures, should be adopted. Considering the danger that dishonesty poses to the integrity of accounting education and due to practitioner dishonesty potentially eroding the public’s trust in the accounting profession, we agree with Burke et al.’s (2007) call for new measures to be adopted and/or believe that current ethical codes should be more stringently enforced in both academia and practice. In a profession where honesty is prized, dishonesty cannot be tolerated. As suggested by Burke et al. (2007), perhaps accounting professors should be required to report all incidences of academic misconduct. In addition, evidence of cheating should be included in official transcripts and state agencies, such as state boards of accountancy, and they should have access to such marked transcripts and potentially bar applicants who cheated in college from taking the CPA exam.

In Ariail et al.’s (2024a) study, accounting students were asked to give their opinions about potential academic responses to cheating. Their results found that the majority (53.6 percent) of accounting students thought that cheating should be reported by accounting instructors up the chain of command (chair and dean); and the majority (52.3 percent) agreed that incidences of cheating should be included on student transcripts. Nevertheless, these students did not think that employers and state societies should be given access to such marked transcripts. These findings suggest that such actions by the academy would positively impact honesty. Including indications of dishonesty on transcripts and making this information available to employers and state boards of accounting might work to discourage academic misconduct by accounting students.

A few states require that a stand-alone accounting ethics course be taken by accounting students, while the great majority of states follow an integrated approach, in which ethics education is integrated into accounting courses. A 2011 study on the stand-alone versus integrated approach concluded that students “who take an Ethics in Accounting course before graduation do seem to have higher ethical reasoning ability than students who have had ethics integrated into their accounting courses” (Klimek & Wenell, 2011, p. 116). As time has passed since the passage of SOX (2002), the integrated approach may have resulted in accounting ethics being given less focus. We call for a refocus. Now is the time for accounting ethics to receive greater attention.

The authors of this essay have long taught accounting, including accounting ethics, in states that require and do not require accounting students to take a stand-alone accounting ethics course. We recommend that stand-alone ethics courses be required. Stand-alone courses in accounting ethics will provide educators with the time needed to adequately teach accounting ethical codes and applicable ethical theories and explain how ethical lapses on the part of accountants have contributed to accounting frauds. Additionally, stand-alone ethics courses will allow for a greater classroom focus on real-world ethical scenarios. Nevertheless, a stand-alone course should not preclude educators from including an ethics component in other accounting courses. Students need to know throughout their accounting education that ethics and personal integrity are fundamental to the accounting profession, not just a subject that receives perfunctory attention.

7. How Accounting Practitioners Can Respond

In agreement with the IESBA, we believe that it is imperative that accounting firms have strong ethical cultures promoted by ethical tones at the top. As indicated in the IESBA report by the Firm Culture and Governance Working Group (IESBA, 2025), promoting an ethical culture includes embedding ethical values within firms, incentivizing ethical behavior, and implementing effective ethical training programs that effectively convey the ethical values of the accounting profession. Establishing firms with unwaveringly ethical cultures, ones that do not tolerate accountants who lack integrity, must be a primary objective of practitioners’ efforts to end the vicious cycle of cheating.

Additionally, we suggest that unethical behavior by CPAs should receive professional society and regulatory attention like that given for violations of Generally Accepted Accounting Principles and violations of Generally Accepted Auditing Standards. If non-CPA practitioners cheat, they should not be allowed to sit for the CPA exam. Further, CPA practitioners who cheat should be barred from future public practice. State boards of CPAs need to make cheaters pay the highest price—the loss of their license to practice. We suggest that the profession’s integrity calls for punishments for academic dishonesty with “teeth”. As seen in the Big-4 cheating scandals, the monetary punishments that have been imposed by the SEC and the PCAOB appear to be ineffective at stopping dishonest acts by practitioners. For the good of the academy and practice, this crisis in accounting academia and accounting practice—a crisis of confidence (Voynich, 2003)—must be stopped. We must preserve our credibility!

8. Conclusions

We suggest that, in accounting academia and in accounting practice, there is ample evidence of a vicious cycle of cheating. Cheating by accounting students is all too common and is potentially again on the uptick. And for the last six years, Big-4 accounting professionals, who should be setting an ethical example for students, have serially cheated on internal tests (cf., KPMG and Deloitte) and even on the ethics portion of the CPA exam (cf., EY) and the Netherlands’ chartered accountant exam (cf., KPMG). As previously indicated, we suggest that students who cheat become practitioners who cheat, and practitioners who cheat set an unethical example for students—unethical modeling supported by both Social Learning Theory and Value Change Theory. Moreover, unethical behavior by accounting professionals lessens the public trust in the accountant’s work product. The recent monetary penalties/fines appear to be ineffective in curbing the cheating of accounting professionals.

Now is the time for accounting leaders in academia and practice to strongly advocate for the importance of ethics in the profession. Educators worldwide must do their part by teaching ethics in a stand-alone course and/or by integrating ethics throughout the curriculum. Accounting professionals must emphasize the importance of ethics in the workplace, public practice, industry, and government/not-for-profit. Regulators must also ensure that punishments for ethical violations are effective. Doing so is necessary for the accounting profession to maintain its trustworthiness, thereby enabling it to fulfill its important role in the economic system and society. Since accounting ethics is a global concern, international cooperation is essential.