Restoring trust in auditing: ethical discernment and the Adelphia scandal

Abstract

Purpose

The purpose of this paper is to encourage ethical discernment as a dimension of business decision‐making.

Design/methodology/approach

Development of ethical discernment and a process of ethical evaluation in the analysis of decisions made by the auditors and management in the Adelphia accounting scandal.

Findings

The paper finds that accounting may benefit from an increased focus on ethical discernment and ethical behavior. Ethical behavior may help restore trust and confidence in the capital market system and reduce fraudulent financial reporting.

Originality/value

This paper presents an alternative to regulation for restoring trust in the financial oversight function.

Citation

Barlaup, K., Iren Drønen, H. and Stuart, I. (2009), "Restoring trust in auditing: ethical discernment and the Adelphia scandal", Managerial Auditing Journal, Vol. 24 No. 2, pp. 183-203. https://doi.org/10.1108/02686900910924572