Preview

Ethics N Business

Good Essays
Open Document
Open Document
501 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Ethics N Business
RUNNING HEAD: Ethics in Business

PROBLEM 1–4 Ethics and the Manager

1. According to the IMA’s Statement of Ethical Professional Practice, would it be ethical for Perlman not to report the inventory as obsolete?

Under the credibility line of the statement of ethical professional practice, it says that each member has a responsibility to disclose all relevant information that could reasonably be expected to influence an intended users understanding of the reports, analysis, or recommendations, and they must communicate information fairly and objectively. Although this is what they as a whole decided to do, does not mean it is ethical. Not reporting this information accurately would be unethical. They would only be doing this to get a bonus, by making their profit, and sales growth look better. This would be cheating and would benefit the management personnel, but not the company. If Perlamn feels that they are not making an ethical decision, he should then discuss it the first chain on command.

2. Would it be easy for Perlman to take the ethical action in this situation?
It would be easy for Perlman as long as he follows the chain of command. He should first discuss it with the management personnel, and if they do not cooperate, and still no want him to report the inventory, he should then follow the chain of command. He should clarify relevant ethical issues by initiating a confidential discussion with an IMA Ethics Counselor or other impartial advisor to obtain a better understanding of possible courses of action. He should also contact a personal lawyer.

PROBLEM 1–7 Ethics in Business

1. How would this behavior affect customers? How might customers attempt to protect themselves against this behavior?

When a business is in a situation like this, they will only hurt themselves. The customers will lose faith in them, and protect themselves by not coming back. They could also report it as unethical, especially if the business was



References: Garrison, R. H., Noreen, E. W., & Brewer, P. C. (2008). Managerial accounting (12th ed.). New York: McGraw-Hill/Irwin.

You May Also Find These Documents Helpful

  • Satisfactory Essays

    Comptronix Case

    • 447 Words
    • 2 Pages

    If the auditor looked at the inventory turnover ratio closer, they could’ve compared it to competitors. They would have realized that there was something wrong.…

    • 447 Words
    • 2 Pages
    Satisfactory Essays
  • Powerful Essays

    Homework10

    • 2261 Words
    • 10 Pages

    Due to the high cost and demand for medicines, there is a risk of theft of inventory both at the distribution centers and stores. Additionally, because some medicines have expiration dates, there is a risk of obsolete inventory. It will be difficult for auditors to identify specific types of medicines since their differences are not visually noticeable but rather dependent on differences in compounds and chemicals. Furthermore, the large number of products, with wide variations in unit costs, could lead to inaccurate amounts.…

    • 2261 Words
    • 10 Pages
    Powerful Essays
  • Good Essays

    Andre's Hair Styling

    • 573 Words
    • 3 Pages

    References: Horngren, C. T., Sundem, G. L., Stratton, W. O., Burgstahler, D., Schatzberg, J (2008) Introduction to Management Accounting Chapters 1-17, 14th Edition, Pearson Prentice Hall.…

    • 573 Words
    • 3 Pages
    Good Essays
  • Powerful Essays

    Military Regulation

    • 87990 Words
    • 352 Pages

    AR 735–5 Policies and Procedures for Property Accountability This revision-o Changes the term "sensitive items" to "controlled inventory item" (paras 1429a(2) and 14-29a(4)(a)). Changes the dollar value of discrepancies that are not reported on inventory adjustment reports (IARs) from $50.00 to $1,000.00 in extended line item value (para 14-29a(4)). Changes the requirement for causative research on IARs from inventory discrepancies resulting in adjustment from over $500.00 to over $1,000.00 in extended line item value (para 14-29c). Changes the goal for inventory adjustments (both gains and losses) for all IARs from less than 2.5 percent of the dollar value to less than 5 percent of the dollar value of the requisitioning object (RO) during the fiscal year (paras 14-29e and 14-29g). Adds condition code changes, re-identification, and pseudoreceipts to administrative IARs that are not included in the total when determining whether the goal of 5 percent has been achieved (para 14-29h(5),(6) and(7)). Adds the terms “causative research” and “controlled inventory items” to the glossary (glossary, sect II). Revision dated 31 January 1998-Identifies the statutory authority and DoD accounting policy that policies and procedures contained in this regulation are based on (para 1-4). Expands the basic requirements for conducting inventories to include property on hand at USAMC Accountable Supply Distribution Activities and Depots, supplies stored by a supply support activity, supplies at the user level accounted for on property book records, real property, and Army War Reserve 3 stocks (para 2-6). Adds, under responsibility, a new type of responsibility, i.e., custodial responsibility, providing the definition and obligations (para 2-8d). Identifies installed carpeting…

    • 87990 Words
    • 352 Pages
    Powerful Essays
  • Good Essays

    Bus 642 Week 2

    • 905 Words
    • 3 Pages

    Page 50 1a. According to Cooper and Schindler (2011) “Ethics are norms or standards of behavior that guide moral choices about our behavior and our relationships with others (p.32). The manager of market intelligence of AutoCorp had to make an ethical decision when she found a competitor’s confidential –restricted circulation crammed into a tiny space on her flight. The most prudent decisions the manager has to make about her responsibilities to herself and others are the ethical standards and behaviors of how the decision can affect her, the business and competitor. Cooper and Schindler (2011) stated “Unethical activities are pervasive and include violating nondisclosure agreements, breaking participant confidentiality, misrepresenting results, deceiving people, using invoicing irregularities, avoiding legal liability, and more (p. 32). So the manager has to decide if she will falsify the documents or hold up her ethical standards and provide the report she originally completed.…

    • 905 Words
    • 3 Pages
    Good Essays
  • Satisfactory Essays

    If the purchase had been handled properly by the controller this transaction may have been considered within ethical standards. However, evidence of weaknesses in internal control over inventory and possible management override of computerized records, that in all appearances increase the risk of adulterated inventory counts and computerized records in general, warrant response from the auditing team during their assessment of financial statements. Although the number of shirts sold to the auditing team do not constitute a material misstatement in regards to the financial statements, the risk related to fraud should be assessed and mitigated during the planning and carrying out of the audit and further audit procedures. These transactions do not affect the existence and valuation assertions relevant to auditing. The right and obligations assertions, on the other hand, may be impacted as physical counts of inventory and their accuracy and completeness come into question. The auditor should be wary of procedures related to physical counts of inventory. Extra care to mitigate intentional or misintentional inclusion of inventory in the physical count should be countered by the auditing team. Additionally, the audit should further address the implications of the ability of management to override perpetual inventory records and computerized information in general in all other areas of the audit to assure that relevant risks are mitigated and minimized. Outside of the effects on the auditing process, this case does not affect the opinion of the auditor on the audited financial statements. In spite of this, the client should be made aware of the discovery.…

    • 507 Words
    • 3 Pages
    Satisfactory Essays
  • Powerful Essays

    Business Ethics

    • 2743 Words
    • 11 Pages

    Galen McDowell was a good salesperson who knew how to purchase the higher performances out of the salespeople under him. Bob wanted to sign a big contract with Kinan Motor who was his potential client, so he gave this assignment to Galen, and Galen got this opportunity to promote his value to the organisation. Then he made the plan to take them to a strip club which is called Red Ruby.…

    • 2743 Words
    • 11 Pages
    Powerful Essays
  • Good Essays

    Cost, Volume and Profit

    • 589 Words
    • 3 Pages

    References: Brewer, P. C., Garrison, R. H., & Noreen, E. W. (2010). Introduction to managerial accounting (5th ed.). New York: McGraw-Hill/Irwin.…

    • 589 Words
    • 3 Pages
    Good Essays
  • Good Essays

    Business Ethics

    • 519 Words
    • 3 Pages

    This paper will compare the Franciscan Values with Kohlberg’s Levels. Cardinal Stritch University is a Catholic Institution of higher education. Cardinal Stritch was found and is sponsored by congregation if the Sister of St. Francis of Assisi. The Franciscan Values are Creating a Caring Community, Showing Compassion, Reverencing All of Creation, and Making Peace. The Kohlberg`s Three Levels and Six Stages of Moral Reasoning Lawrence Kohlberg, a professor of psychology in the University of Chicago, he created his own theory of moral development. The theory is based on children‘s reasoning, when facing moral dilemmas, however, Kohlberg went far beyond that and created a common theory for all ages. Under his theory moral thinking passes through six separate stages, which are broken into three levels. This paper aims to compare the Franciscan Values…

    • 519 Words
    • 3 Pages
    Good Essays
  • Satisfactory Essays

    Edmonds, T., Olds, P., Tsay, B.. (2008). Fundamental managerial accounting concepts, 5th edition, chapter 13. McGraw-Hill/Irwin.…

    • 717 Words
    • 3 Pages
    Satisfactory Essays
  • Good Essays

    Gvv Case Stydy

    • 821 Words
    • 4 Pages

    Risk of job for other employee in the company. By exposing the issues in the company, Mike is not the only guy who may be kicked out of the company, the accounting staff member who informed Mike about the manipulating annual financial statement and bribe thing is also be in trouble. Even worse, the CEO may consider taking action on other employee who he thinks the person knows the issues without prove it.…

    • 821 Words
    • 4 Pages
    Good Essays
  • Powerful Essays

    Brief 4 Dejan Lazaroski

    • 1879 Words
    • 10 Pages

    Tyva can improve the net income if sells more of the Deluxe model of sandals, because of the higher contribution margin per unit versus the other Regular model.…

    • 1879 Words
    • 10 Pages
    Powerful Essays
  • Powerful Essays

    Business Ethics

    • 1334 Words
    • 6 Pages

    Question 1: What is the moral point of view and why is it important? Does it make sense to say that business people must operate from the perspective of the moral point of view? Why, or why not?…

    • 1334 Words
    • 6 Pages
    Powerful Essays
  • Better Essays

    Company Internal Control

    • 1725 Words
    • 7 Pages

    The new rules require management to disclose to the public any material weakness identified by management. The report must also state that the company’s independent public accountant who audited the financial statements included in the annual report has attested to and reported on management’s evaluation of internal control over financial reporting.…

    • 1725 Words
    • 7 Pages
    Better Essays
  • Good Essays

    b. Monitoring of inventory, management at Goodner Huntington facility should have monitored inventory more often than once a year. This infrequent inventory monitoring allowed Woody to perpetrate fraud unimpeded for far longer than if management was doing monthly or at least quarterly inventory counts.…

    • 854 Words
    • 4 Pages
    Good Essays