The Effect of Accounting Capability and Accounting Professional Ethics on Financial Reporting Quality of Limited Company in the Northeast Region.

Abstract

       The purpose of this study was to the effect of accounting capability and accounting professional ethics on financial reporting quality of limited company in the Northeastern by using questionnaire as an instrument for collecting data from 193 accounting executives of limited companies in the Northeast, selected by a stratified random sampling technique. The statistics used for analyzing the collected data were multiple correlation analysis and multiple regression analysis. The result showed that 1) the accounting capability in the aspects of knowledge, skills, and professional values had positive relationships with and effects on financial reporting quality; 2) the accounting professional ethics in the aspects of integrity, professional competence, and professional behavior had positive relationships with and effects on financial reporting quality. Therefore, the accounting capability and accounting professional ethics had positive relationships with and effects on financial reporting quality of limited company in the Northeastern.  As a result of this research, therefore, accountants should pay attention to the development of accounting proficiency knowledge in standard and laws which related to accounting profession and to the skills training continually. Furthermore, the accountants must perform their work by adhering to the accounting professional ethics in accordance with the requirements of the Federation of Accounting Professions No. 19 in order to ensure the quality of financial reporting and the reliability of users.