Running head: FORUM1: INTEGRATIVE CASE 1-43

Forum1: Integrative Case 1-43 Audrey Dodson Liberty University January 15, 2014

FORUM 1: INTEGRATIVE CASE 1-43 Forum1: Integrative Case 1-43

Individuals are born with inherent ethics but continue to learn and develop ethics through associations with others. Ethics is an individuals guide for choices and actions (Collins, 2012) and determines and individuals conduct and decision making (Kubasek, Brennan, & Browne, 2012). In essence, ethics is the foundation for making the right choices whether the choices are personal or business (Collins, 2012). Ethics in the workplace is no different than personal ethics. Individuals will be faced with situations where it will be necessary to determine if a particular course of action is ethical. When faced with an ethical dilemma, the course of action an individual decides to take should be carefully considered so that the action does not cost the company time, money, and resources (Wilbanks, 2013). Can you justify what Charles did? Charles falsified the income statement on two occasions out of fear of losing his job, being blacklisted by his boss, and added pressure from personal problems. Though his reasons may appear justifiable to himself, there is no justification for what Charles did. Management accountants and financial management are obligated to the public, to their profession, their employer, and to themselves to maintain the highest standard of ethical conduct which includes the IMA standards of competence, confidentiality, integrity, and credibility (Lanen, Anderson, & Maher, 2014, p. 23). Charles violated the standards of competence, integrity, and credibility. Competence was violated because Charles did not perform his professional duties in compliance with relevant laws and regulations, and because of Charless deliberate misrepresentation of sales on the income statement. The standard of integrity was violated because Charles engaged in conduct that hindered him from ethically carrying out his duties; his conduct and actions could also be

FORUM 1: INTEGRATIVE CASE 1-43 reason to discredit the accounting and finance profession (Lanen, Anderson, & Maher, 2014). Charless credibility and the organizations credibility could potentially be harmed because of their disclosure of unreliable information (Lanen, Anderson, & Maher, 2014, p. 24). What could Charles have done to avoid the ethical dilemma that he faced? Assume that the company president would have made it impossible for Charles to work in Atlanta in a comparable job. Ethical dilemmas are inevitable; therefore, organizations should have a policy for resolving conflicts. Charles should have first followed the established policies of the company for resolution. If the companys policies were ineffective, Charles should then have discussed the issue with the next level of authority. Because Charless boss is involved in the ethical dilemma, the next level of authority could be the audit committee or the board of directors. Charles could have used an ethics hotline to speak confidentially with someone to better understand alternative courses of action. To be better prepared, Charles could also have spoken with his attorney to understand the legal ramifications and his rights relative to the ethical issue (Lanen, Anderson, & Maher, 2014, p. 19) . What if the Securities and Exchange Commission discovered this fraud? Would Charless boss get in trouble? Would Charles? If the Securities and Exchange Commission discovered this fraud both Charles and his boss would get in trouble. The president of the organization is considered the CEO and Charles is the CFO. The CEO and the CFO are responsible for the financial statements. The SarbanesOxley Act of 2002 requires that the CEO and the CFO sign the financial statements to show that the report has been reviewed and to their knowledge the financial statements fairly represent the

organizations financial condition and results of operations (Lanen, Anderson, & Maher, 2014, p. 20).

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In addition, please answer if you or the company you worked for have ever been faced with a similar situation. You do not need to release any company names or state anything that would give the company or its individuals away. However, you must provide a few details as to the type of situation that occurred and how it was resolved. In a former position, I reported to the Vice President of Disbursements as the Credit Card Administrator and Program Leader. One aspect of my job entailed auditing monthly credit card statements of corporate cardholders. Employees of the organization were issued credit cards for travel and entertainment and for supplies. During an audit of the monthly statement of the Presidents administrative assistant, large purchases unrelated to travel and entertainment and supplies were discovered which totaled over $800,000. My first course of action was to obtain receipts from the credit card company for these purchases. I then met with my boss to go over my findings and to be advised of the next steps to be taken. My boss then spoke with the CFO who then spoke to the organizations audit committee. After completing a thorough investigation, the audit committee revealed their findings to the President. The employee who committed fraud was let go and faced legal prosecution by the organization. Though the employee was not a member of management the higher levels of authority were necessary because of the amount of money involved and also because the employee reported directly to the president of the company.

FORUM 1: INTEGRATIVE CASE 1-43 References Collins, B. (2012, September 1). Ethics and integrity: capstone professional tools. Journal of Environmental Health. Retrieved from http://www.readperiodicals.com/201209/2754652011.html Kubasek, N., Brennan, B., & Browne, M. (2012). The legal environment of business: A critical thinking approach (6th ed.). Upper Saddle River: Pearson. Lanen, W. N., Anderson, S. W., & Maher, M. W. (2014). Fundamentals of cost accounting (4 ed.). New York, NY: McGraw-Hill/Irwin. Wilbanks, L. (2013). Ethical dilemmas in the workplace. IT Professional, 15(1), 60-61. Retrieved from http://ieeexplore.ieee.org.ezproxy.liberty.edu:2048/xpls/abs_all.jsp?arnumber=6427790