Integration of Accounting Systems and Behavioral Economics: A Study on the Impact of Human Behavior on Financial Reporting
Integration of Accounting Systems and Behavioral Economics: A Study on the Impact of Human Behavior on Financial Reporting

Summary/Abstract: In this research we look into how accounting systems and behavioral economics are integrated by examining the cognitive (behavioral), psychological, and emotional aspects that impact auditors, accountants, and the stakeholders in financial reporting. The role of ethics is emphasized as being a core element of financial services practice and the importance of ethical principles for transparency and trust is stressed. The research will assist in developing awareness of ethics and strengthening one's conscious for integrity decision-making environment, leading to reliability and relevance of financial records. A positivist science approach was utilized in the study and a five-point Likert-scale-based structured questionnaire was adopted. The questionnaire was sent to financial managers, auditors and accountants, and we collected 72 valid responses after excluding incomplete questionnaires. Data were analyzed using the SPSS program. The results indicate that incorporating psychological principles from behavioral economics into accounting can enhance judgment in structured and ethical accounting environments. Findings reveal that financial reporting gains clarity and believability when this cross-disciplinary approach is applied. The study suggests that finance professionals and regulators must cultivate new mental frameworks that align with the evolving nature of financial behavior.

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