Managerial Accounting FSM Hirjoaba PDF

University of Applied Sciences
Campus Zweibrücken
Faculty FSM
Course of studies MASTER
Essay
„ETHICAL CONSIDERATIONS IN MANAGERIAL ACCOUNTING“
Student:
Full name: ALEXANDRA BEATRIX HIRJOABA
CLASS: FSM
Matriculation no.: 876078
Proofreader:
Prof. Dr. Ieva Kozlovska
Date of submission:
30.08.2017
Essay: Ethical Considerations in Managerial Accounting | Alexandra Beatrix Hirjoaba
STRUCTURE OF THE ESSAY
1. INTRODUCTION ....................................................................................................................3
2. STANDARDS OF ETHICAL CONDUCT FOR MANAGEMENT ACCOUNTANTS -
Four basic principles - ..................................................................................................................5
2.1 How can Managerial Accountants respect the Four Standards of IMA? ...............................6
2.2 Two important studies show that there are some majoritar violations of ethical conduct in
Managemerial Accounting ...........................................................................................................8
2.3 What are the main ethical issues about Managerial Accounting? .......................................10
2.4 How did some corporations failed to respect the four guidelines of IMA and what were the
consequences? ............................................................................................................................11
3. CONCLUSION .......................................................................................................................14
3.1 Importance of Business Ethics in Managerial Accounting .................................................15
3.2 Consequences of Bad Ethical Accounting Practices ...........................................................16
3. BIBLIOGRAPHY ...................................................................................................................17
August 30, 2017 2

ETHICAL CONSIDERATIONS IN MANAGERIAL ACCOUNTING
Abstract: In the past few years accounting and managerial accounting have changed
visibly. Case intensified media coverage of companies that falsified financial reports
(Enron, WorldCom, Parmalat, Tyco, etc.) have led to the decline in the credibility of the
accountancy among the public. Increasing the complexity of the accounting field,
overloading with information that can no longer be managed efficiently and on time,
frequent changes in legislation - all these represent ethical issues for accounting. Starting
from these considerations, this essay treats some aspects of ethics and morality in
management accounting and some examples of ethical violation done in this regard by big
companies, with its consequences. The purpose of the essay is to try to show that, being
aware of the ethics characteristics that the accounting information (competence,
confidentiality, integrity and objectivity.) must meet, managers will still constantly
oscillate between the temptations of less ethical behavior.
Key words: Ethics, Morality, Accounting, Management
1. INTRODUCTION
Ethics is a Code of Conduct that applies to everyday life. It deals with the fairness or inaccuracy
of certain actions. Ethical actions are the result of individual decisions. Employees of a company
are confronted with many ethical situations on a daily basis.
• When an organization is said to have a fair or incorrect ethical activity, it means that the
individuals in that organization have decided to act in one way or another.
• When a company uses false advertising, disinforms a client, pollutes the environment,
has a negative attitude towards its own employees, or misleads investors by presenting
false financial reports, it means that management and other employees of the company
have taken a A conscious decision to act immorally.
Likewise, ethical behavior within the company is the direct result of the actions and decisions of
its employees.
August 30, 2017 3

Accountants are exposed in a market where there is a confrontation between demand and supply
of accounting information. That's why "accountants" will offer:
• An image of performance for countries where investment shows strong pressure;
• A picture of stability for countries where bankers hold the dominant position;
• A fiscal picture for countries where the state plays a significant role in accounting (in
countries where accounting is not disconnected from taxation).
The main objective of Accounting Management

The main objective of Accounting Management is to provide management with the information
it needs to make well-grounded decisions. It also develops internal control systems to increase
efficiency and prevent fraud. It contributes to planning, budgeting and controlling costs.
The responsibility it has, is also to ensure proper records, correct financial reports and
compliance with tax legislation and governmental rules. In addition, the managerial accountants
need to be aware of the latest achievements in the use of computing and computer systems
design.
In the US, the Management Accountants can confirm their competence and professional training
by obtaining the title of Authorized Accountant (CMA) certified by the Institute of Chartered
Accountants of the Institute of Management Accountants. Under the CMA program, candidates
have to undergo an examination consisting of several tests and comply with the teaching and
professional standards.
On June 1, 1983, the Institute of Management Accountants (IMA), previously called the National
Association of Accountants (NAA), formally adopted a set of standards of ethical behavior for
accountants.
These standards mention responsibilities for

• Competence
• Confidentiality
• Integrity
• Objectivity.
August 30, 2017 4

2. STANDARDS OF ETHICAL CONDUCT FOR MANAGEMENT

ACCOUNTANTS - Four basic principles -
The Institute of Management Accountants (formerly the National Accountants' Association)

adopted the Code of Professional Conduct for Management Accountants. This moral code
emphasizes the fact that an accountant must be competent in the position he holds, respect the
confidentiality of the information, unless authorized or required by law to disclose it, to remain
integrated to avoid conflicts of interest and to transmit the information objectively, without
deviations.
1.
Credibility is essential to the accounting profession.

This credibility requires accountants to adhere to strict ethical behavior standards. But for
accountants, ethical standards are equally important.
On June 1, 1983, the Institute of Management Accountants (IMA), formerly the National
Association of Accountants (NAA), formally adopted a set of standards of ethical behavior for
accountants
These standards mention responsibilities for competence, confidentiality, integrity and
objectivity
August 30, 2017 5
1
)
2.1 How can Managerial Accountants respect the Four Standards of IMA?
a. Jurisdiction
To act ethically, managerial accountants must first be competent. In today's changing
environment, the skills of a professional can morally wear off quickly. In order to be aware of all
the new management accounting issues and techniques, accountants must permanently
participate in professional development and training programs.
The competence required for managerial accountants is also very comprehensive, ample. They
must understand and abide by all laws, regulations and technical norms that relate to their duties.
Professional competence must be demonstrated on a permanent basis whether it be its own
company, external entities associated with the company (clients, bidders and performers) or the
market in general.
Moreover, in order to provide management information and reports, management accountants
need to analyze the relevant data and methods. Reports, financial analyzes and reports must
reflect all necessary information, comply with current reporting standards and clearly state the
accountant's conclusions.
b. Confidentiality
Managerial accountants are entrusted with information considered by confidential management
and over which the company is entitled to ownership. In most cases, the reports provided by the
managerial accountants have a direct impact on the company's profitability. The leakage of such
information could give competitors an unfair advantage. The information should not be
communicated to any person inside or outside the company that is not authorized to receive it,
unless this is required by law.
In the exercise of their duties, accountants often account for other accountants. These
subordinates must be informed whenever they work with confidential or restricted data.
More than that, the managerial accountant should monitor the actions of the subordinates to
ensure that they respect confidentiality. Of course, disclosure is not the only way to violate the
requirement of confidentiality.
All non-ethical action is considered and the use of confidential information, directly or through
third parties, for personal interest or to harm the company, in this case, except in those cases
where the accountant is legally bound to disclose that information.
August 30, 2017 6

c. Integrity
He assumes that a managerial accountant is impartial. In order to meet this requirement, he must
avoid any actual or potential conflict of interest. For example, accounting for the shares of a
company that is in competition with other bidders for the company's orders in which it operates
is a potential conflict of interest if it makes a direct contribution to the selection of bids.
The managerial accountant is required to inform all parties involved of a potential conflict.
Managerial accountants should avoid relationships with individuals or legal entities that could
generate conflicts of interest or compromise their work. No gifts, services or hospitality should
be accepted from individuals or legal entities.
Realistic (not unconditional) loyalty to the company, branch and country is an important aspect
of integrity. Running an action or encouraging an activity that threatens the natural and natural
goals of the company is not ethical.
If a management accountant obtains information about an unfair, incompetent or illegal action
that poses a threat to the company, he is required to communicate this information to
management. Reports provided by managerial accounting must be accurate and accurate,
regardless of whether the results of the analysis have a positive or negative impact on the firm.
Changing reports to meet certain goals or exceeding certain estimates is not an ethical action
d. Objectivity
The managerial accountant is responsible for all financial reports and most of the non-financial
reports provided to management. Management is based on these business decision-making
reports as well as (indirectly) others outside the company
• Investors
• Creditors
• Bidders
• The client
All these people have the right to objective information, and it is the managerial accountant who
must provide them.
Especially internal managers depend on information generated by the manager. Compliance with
ethical standards is essential to the performance of these reporting tasks. Knowing ethical norms
and being able to identify non-ethical actions and avoiding compromising situations should be an
integral part of your knowledge and skills when starting a career in the business world.
August 30, 2017 7

2.2 Two important studies show that there are some majoritar violations of
ethical conduct in Managemerial Accounting
The FIRST study – States the issues about the majoritar situation in companies where the
transparency is lacking and the manipulation is crescending
The results of an empirical survey on auditors' perception by Balaciu et al (2012) show that most
(44%) consider that the financial statements prepared by the companies are not sufficiently
transparent, 68% of them consider that the accounting manipulation is a frankly encountered
process in practice
The SECOND study – States that the pressure to compromise ethical standards and is
higher
In a global survey on business ethics of around 2,000 respondents from around 80 countries
conducted by the American Institute of Certified Public Accountants [AICPA] and the Chartered
Institute of Management Accountants [CIMA] and reported in 2012 [6], some of the key findings
were as follows:
• Pressure to compromise organizational standards of ethical conduct had increased
significantly compared to 2008;
• Violations of ethical conduct were observed by 23% of the respondents.
• 69% of those who observed violations claimed to have reported it and 26% of those who
claimed to have reported violations feared retribution for having done so;
• According to 22% of the respondents, the most pressure to compromise ethical standards
came from colleagues in other functional areas of the organization.
Missing information or selective reporting of information to decision makers can result in

erroneous or suboptimal strategies because of the lack of quality of information at hand at a
given time for them to make sound decisions.
Managers will constantly oscillate between the temptations of less ethical behavior
Knowing the qualitative characteristics that the accounting information (intelligibility, relevancy,
credibility and comparability) needs to be in line with a unanimously recognized international
accounting record and to participate in the correct representation of economic phenomena and
transactions, managers will oscillate in The permanence of the temptations of less ethical
behavior, but still within the limits of the law, and the pressure of passing the most favorable
signals to users on the performance of the company it manages
August 30, 2017 8

In such a situation, not at all easy, they will see themselves in the position of making decisions,
which can not always be qualified as rational.
The irrational component of manipulating digits in such a way that signals are improved, but
behavior is no longer an ethical one, but it has nothing to do with mental madness, but rather, as
it results from behavioral theories, with aversion Risk, over optimism or mental frames.
Since financial accounting is mandated by legal requirements of governments there is more
opportunity in managerial accounting for ethical discrepancies and malpractices.
According to the journalist publication Keeron1 there is pointed a very interesting argument as to
which why managerial accounting tends to be more unethical.
• Financial accounting reports the current financial health of the company and shows how
the company has performed to external stakeholders, whereas managerial accounting
looks at the present and allows mangers to make decisions about the future
• Financial accounting is for the public record, whereas managerial accounting could be
confidential. Financial accounts must be reviewed, certified, and reported by external
auditors, while managerial accounts do not have to be revealed to external sources
• Financial accounting should follow set procedures and standards, GAAP - General
Accepted Accounting Procedure, so they are comparable to the financial accounts of
others, whereas managerial accounts do not have to follow set procedures and are done
according to management’s preferences
1
Karen W. Braun, Case Western Reserve University (©2010 Pearson). Solutions Manual for Managerial
Accounting, 2nd Edition
August 30, 2017 9

2.3 What are the main ethical issues about Managerial Accounting?
As mentioned earlier in one of the main differences between Financial and Managerial
Accounting, since Managerial Accounting could be confidential and are done as per
management’s preferences that leaves a lot of decisions to subjective judgment, which can lead
to personal preferences, biases and favoritism, or even sabotage due to interpersonal rivalry in
the firm.
A managerial accountant must be competent and able to maintain confidentiality.

Providing wrong information or wrongly accounting for financial information can gravely hurt
the corporation for they will not be able to get the true picture.
By the time they can figure out that something is wrong in the managerial accounting much
damage could have occurred and the existence of the corporation could be in jeopardy.
Additionally, a failed corporation could negatively affect employment and income of employees.
A managerial accountant must be competent and able to maintain Integrity.

As managerial accounting is generally within a firm, managerial accountants need high ethical
standards in determining who should be privy to the information in their possession.
• How far does their authorized jurisdiction extend?
• Do they share the information with those within the firm but outside the individual
accountant’s authorized jurisdiction?
• Do they conceal damaging information from authorities within the firm but outside their
authorized jurisdiction?
• Do they act as whistleblowers and report white collar criminal activities to the top
management or government authorities?
They should be conscientious in providing accurate numbers without tailoring and doctoring
figures for ulterior motives.
A managerial accountant must be competent and able to maintain objectivity.

Giving credit to the right entities and maintaining objectivity are essential pillars for preserving
integrity. Buttross, Schmelzle, and Rao, found in a survey of 168 members of the Institute of
Management Accountants that pressure from supervisors affected both ethical and unethical
behaviors of management accountants.
August 30, 2017 10

2.4 How did some corporations failed to respect the four guidelines of IMA
and what were the consequences?
According to Business Insider.com, Greg2, the most notorious Corporate Accounting violation of
IMA guidelines and their consequences are:
Enron Scandal (2001)

Company: Houston-based commodities, energy and service corporation
What happened: Shareholders lost $74 billion, thousands of employees and investors lost their
retirement accounts, and many employees lost their jobs.
Main players: CEO Jeff Skilling and former CEO Ken Lay.
How they did it: Kept huge debts off balance sheets.
How they got caught: Turned in by internal whistleblower Sherron Watkins; high stock prices
fueled external suspicions.
Penalties: Lay died before serving time; Skilling got 24 years in prison. The company filed for
bankruptcy. Arthur Andersen was found guilty of fudging Enron's accounts.
WorldCom Scandal (2002)

Company: Telecommunications company; now MCI, Inc.
What happened: Inflated assets by as much as $11 billion, leading to 30,000 lost jobs and $180
billion in losses for investors.
Main player: CEO Bernie Ebbers
How he did it: Underreported line costs by capitalizing rather than expensing and inflated
revenues with fake accounting entries.
How he got caught: WorldCom's internal auditing department uncovered $3.8 billion of fraud.
Penalties: CFO was fired, controller resigned, and the company filed for bankruptcy. Ebbers
sentenced to 25 years for fraud, conspiracy and filing false documents with regulators.
2
Greg Voakes, Hack CollegeNov. 19, 2012.INFOGRAPHIC: The 10 Worst Corporate Finance Scandals.
August 30, 2017 11

Tyco Scandal (2002)

Company: New Jersey-based blue-chip Swiss security systems.
What happened: CEO and CFO stole $150 million and inflated company income by $500
million.
Main players: CEO Dennis Kozlowski and former CFO Mark Swartz.
How they did it: Siphoned money through unapproved loans and fraudulent stock sales. Money
was smuggled out of company disguised as executive bonuses or benefits.
How they got caught: SEC and Manhattan D.A. investigations uncovered questionable
accounting practices, including large loans made to Kozlowski that were then forgiven.
Penalties: Kozlowski and Swartz were sentenced to 8-25 years in prison. A class-action lawsuit
forced Tyco to pay $2.92 billion to investors.
HealthSouth Scandal (2003)

Company: Largest publicly traded health care company in the U.S.
What happened: Earnings numbers were allegedly inflated $1.4 billion to meet stockholder
expectations.
Main player: CEO Richard Scrushy.
How he did it: Allegedly told underlings to make up numbers and transactions from 1996-2003.
How he got caught: Sold $75 million in stock a day before the company posted a huge loss,
triggering SEC suspicions.
Penalties: Scrushy was acquitted of all 36 counts of accounting fraud, but convicted of bribing
the governor of Alabama, leading to a 7-year prison sentence.
American International Group (AIG) Scandal (2005)

Company: Multinational insurance corporation.
What happened: Massive accounting fraud to the tune of $3.9 billion was alleged, along with
bid-rigging and stock price manipulation.
Main player: CEO Hank Greenberg.
How he did it: Allegedly booked loans as revenue, steered clients to insurers with whom AIG
had payoff agreements, and told traders to inflate AIG stock price.
August 30, 2017 12

How he got caught: SEC regulator investigations, possibly tipped off by a whistleblower.
Penalties: Settled with the SEC for $10 million in 2003 and $1.64 billion in 2006, with a
Louisiana pension fund for $115 million, and with 3 Ohio pension funds for $725 million.
Greenberg was fired, but has faced no criminal charges.
Lehman Brothers Scandal (2008)

Company: Global financial services firm.
What happened: Hid over $50 billion in loans disguised as sales.
Main players: Lehman executives and the company's auditors, Ernst & Young.
How they did it: Allegedly sold toxic assets to Cayman Island banks with the understanding that
they would be bought back eventually. Created the impression Lehman had $50 billion more
cash and $50 billion less in toxic assets than it really did.
How they got caught: Went bankrupt.
Penalties: Forced into the largest bankruptcy in U.S. history. SEC didn't prosecute due to lack of
evidence
Another simpler exampler on how the ethical guidelines are not respected is provided
according to Karen W. Braun3 in which the question of morality is put:
If cashiers routinely shortchanged customers whenever the opportunity presented itself, most of
us would be careful to count our change before leaving the counter. Imagine what effect this
would have on the line at your favorite fast-food restaurant.
How would you like to wait in line while each customer laboriously counts out his or her
change? Additionally, if you can’t trust the cashiers to give honest change, can you trust the
cooks to take the time to follow health precautions such as washing their hands? If you can’t
trust anyone at the restaurant would you even want to eat out?
Generally, when we buy goods and services in the free market, we assume we are buying from
people who have a certain level of ethical standards. If we could not trust people to maintain
those standards, we would be reluctant to buy. The net result of widespread dishonesty would be
a shrunken economy with a lower growth rate and fewer goods and services for sale at a lower
overall level of quality.
3
Karen W. Braun, Case Western Reserve University (©2010 Pearson). Solutions Manual for Managerial
Accounting, 2nd Edition
August 30, 2017 13

3. CONCLUSION
If people generally did not act ethically in business, no one would trust anyone else and people
would be reluctant to enter into business transactions. The result would be less funds raised in
capital markets, fewer goods and services available for sale, lower quality, and higher prices
Corporations are entirely dependent on managerial accountants
Corporations are entirely dependent on managerial accountants for providing the true state of
operations such as “accurate market purchasing trends, inventory quantity levels, as well as
expected costs for supplies and production labor”. Unethical managerial accounting could result
in misleading numbers resulting in stock outs, delivery delays, production stoppages and
wastages, financial failings, and disastrous strategic decisions.
Challenges are and will be created to ethics in managerial accounting

With the developments in information technology additional challenges are and will be created
to ethics in managerial accounting. Such developments include phishing, hacking, and cloud
computing. These developments make it possible to usurp managerial accounting information of
competitors. This is highly unethical.
Many of the most egregious financial reporting fradus result from violation of the IRA
ethical guidelines
According to Edition Belverd E4 the IRA guidelines help managers meet their obligation to their
company’s stockholders and to their creditors. Many of the most egregious financial reporting
fradus result from violation of these guidelines – as the following examples show:
RECOGNITION
- Computer Associates - Violated the guidelines for recognition when it kept its books
open a few days after the end of a reporting period so revenues could be counted a
quarter earlier than they should have been. In all, the company prematurely reported $3.3
billion in revenues from 363 software contracts. When SEC ordered the company to stop
the practice, Computer Associates’ stock price dropped by 43% in a single day.
4
Edition Belverd E. Needles, Marian Powers, Susan V. Crosson (2010). Financial and Managerial Accounting, 9th
Edition
August 30, 2017 14

VALUATION
- Enron Corporation - Among its many other transgressions violated the guidelines for
valuation when it transferred, to related companies, assets at far more than their actual
value.
CLASSIFICATION
- WorldCom - By a simple violation of the guidelines for classification (now MCI, a
component of Verizon) perpetrated the largest financial fraud in history. Over a period of
several years, the company recorded as assets its expenditures that would have been
classified as expenses, understanding expenses and overstating income by more than
$10billion
According to Dan L. Heitger, Maryanne M. Mowen, Don R. Hansen5 ,many of the accounting
scandals – such as those involving Adelphia, WorldCom, HealthSouth, Parmalat and McKesson,
provide evidence of the pressure faced by top managers and accountants to produce larde net
income numbers. Unfortunately, such individuals often give into these pressures when faced with
questionable revenue – and cost related judgements. For example, the scandal at WorldCom was
commited because the CEO, Bernie Ebbers, coerced several of the top accountants at WorldCom
to wrongfully record journal entries into the company’s books that capitalized millions of dollars
in costas as assets rather than expenses.
3.1 Importance of Business Ethics in Managerial Accounting
When companies don't see the importance of business ethics in managerial accounting they
usually end up down the same road as those mentioned above: bankrupt. And while that isn't
always true, the importance of business ethics in managerial accounting cannot be understated if
you want your company to be a success.
• Why Ethics Is Important in Managerial Accounting?
A study led by the Institute for Business Ethics in the UK (IBE, set up in 1986, with concerns
about professional ethics - good business practice, clearly shows that companies that have
explicitly committed themselves to doing business ethicly have earned profit margins up to 18%
higher than companies that have not chosen this path.
5
Dan L. Heitger, Maryanne M. Mowen, Don R. Hansen Cengage Learning, 01.11.2007. Fundamental Cornerstones
of Managerial Accounting
August 30, 2017 15

As a conclusion of the study, IBE believes that this study is clear evidence that companies that
have a code of ethics and respects it have outperformed those companies that do not have such a
code, also referring to the fact that a code Ethics can be considered the mark of a well organized
and especially well-run company.
The existence of a code of ethics is not sufficient (and Enron has a code of ethics).
It is necessary to involve top management and organizations patronizing these liberal professions
to make this code a flexible and easy-to-follow document.
Leaders of both the accounting and auditing professions must work together to increase the
responsibility to act primarily in the public interest, thus increasing the confidence of the last
category under discussion, the utmost confidence in achieving the set goals (and, as an example,
we bring to the attention of one of the The world's most prestigious auditing and consulting
offices, Arthur Anderson, who actually disappeared from the market after the Enron business just
because customers had lost confidence, pointing out the fragility of the trust mechanism that
should never be underestimated, A profession like audience)
3.2 Consequences of Bad Ethical Accounting Practices
• What are the Consequences of Bad Ethical Accounting Practices?

Businesses rely on word of mouth and past conduct to customers and creditors to remain
successful. A company's day-to-day managerial accountants are relied upon to portray accurate
market purchasing trends, inventory quantity levels, as well as expected costs for supplies and
production labor.
If the managerial accountant is unethical, it can result in long-term negative consequences for the
company, according to the USA Today, John Freedman6 such as:
Misappropriation of Assets
A business owner might think he's only using his own assets when he takes business goods for
personal use, such as a ream of copy paper or a pizza at the end of the night, but an employee
might see things differently. The employee may see the use or appropriation of business goods
for personal needs as a benefit of being an employee. Before long, the employee who witnessed
the owner's borrowing has become a borrower himself and others are seeing this employee's
behavior as acceptable.
6
John Freedman. Consequences of Bad Ethical Accounting Practices.
August 30, 2017 16

Civil and Criminal Penalties

If company management is unethical to the point of financial fraud, the company could be
subject to civil and criminal penalties. For publicly traded companies, the Sarbanes-Oxley Act
prescribes fines and prison time for knowingly falsifying financial information. Further,
investors of the company may be able to successfully sue the company and its owners for civil
damages. Small-business owners should exercise caution, as not understanding accounting
practices and standards is not a defense for fraudulent reporting. If a reasonable person believes a
manger should have known about fraud in the business, this may be enough to allow the jury to
side with the plaintiff.
Loss of Reputation
In general, customers would rather shop at businesses that operate ethically, take care of their
employees and support their communities. If your company does not operate ethically, this can
affect the willingness of customers and suppliers to conduct business with you. Over time, this
may destroy your business.
Loss of Human Capital
Many good employees do not want to work for a company that is unethical. Accounting
professional standards require that accounting work is performed ethically and with integrity. If
you pressure company accountants to behave unethically, these accountants can't uphold the
standards of their profession, and they might risk loss of their license or credentials. Reputable
accountants will not work for an employer who expects unethical behavior.
August 30, 2017 17

4. BIBLIOGRAPHY
1. Balciu Diana Elisabeta. Etica si contabilitatea creativa. Abordari teoretice si evidente

empirice din spatial universitar si professional. Available:
http://excelenta.ase.ro/Media/Default/Page/balaciud.pdf
2. Dan L. Heitger, Maryanne M. Mowen, Don R. Hansen Cengage Learning, 01.11.2007.

Fundamental Cornerstones of Managerial Accounting
3. Edition Belverd E. Needles, Marian Powers, Susan V. Crosson (2010). Financial and
Managerial Accounting, 9th Edition
4. Greg Voakes, Hack CollegeNov. 19, 2012.INFOGRAPHIC: The 10 Worst Corporate

Finance Scandals. Available: http://www.businessinsider.com/infographic-the-10-worst-
corporate-finance-scandals-2012-11?IR=T
5. IMA Statement of Ethical Professional Practice. Available: https://www.imanet.org/-

/media/b6fbeeb74d964e6c9fe654c48456e61f.ashx
6. John Freedman. Consequences of Bad Ethical Accounting Practices. Available:

http://yourbusiness.azcentral.com/consequences-bad-ethical-accounting-practices-
7750.html
7. Karen W. Braun, Case Western Reserve University (©2010 Pearson). Solutions Manual
for Managerial Accounting, 2nd Edition
8. Keeron Sreyoshi Ghose (publ. JORUNAL Jan 2015). Ethics in Managerial Accounting:
Today’s Challenges in USA. Available:
https://www.globalsciencejournals.com/content/pdf/10.7603%2Fs40741-014-0018-x.pdf
9. Prep. drd. Marius-Sorin Ciubotariu, Universitatea “Ştefan cel Mare”. Etică şi moralitate
în profesia contabilă. Available:
http://www.doctorat2010.usv.ro/art_doctoranzi/85/Etica%20si%20moralitate%20in%20p
rofesia%20contabila.pdf
10. Radell Hunter, Importance of Business Ethics in Managerial Accounting. Available:

http://www.brighthub.com/office/finance/articles/72762.aspx
August 30, 2017 18

Managerial Accounting FSM Hirjoaba PDF

Cargado por

Información del documento

Derechos de autor

Formatos disponibles

Compartir este documento

Compartir o incrustar documentos

Opciones para compartir

¿Le pareció útil este documento?

¿Este contenido es inapropiado?

Copyright:

Formatos disponibles

Managerial Accounting FSM Hirjoaba PDF

Cargado por

Copyright:

Formatos disponibles

University of Applied Sciences

STRUCTURE OF THE ESSAY

August 30, 2017 2

ETHICAL CONSIDERATIONS IN MANAGERIAL ACCOUNTING

Key words: Ethics, Morality, Accounting, Management

August 30, 2017 3

The main objective of Accounting Management

These standards mention responsibilities for

August 30, 2017 4

2. STANDARDS OF ETHICAL CONDUCT FOR MANAGEMENT

The Institute of Management Accountants (formerly the National Accountants' Association)

Credibility is essential to the accounting profession.

August 30, 2017 5

August 30, 2017 6

August 30, 2017 7

Missing information or selective reporting of information to decision makers can result in

August 30, 2017 8

August 30, 2017 9

A managerial accountant must be competent and able to maintain confidentiality.

A managerial accountant must be competent and able to maintain Integrity.

A managerial accountant must be competent and able to maintain objectivity.

August 30, 2017 10

Enron Scandal (2001)

WorldCom Scandal (2002)

August 30, 2017 11

Tyco Scandal (2002)

HealthSouth Scandal (2003)

American International Group (AIG) Scandal (2005)

August 30, 2017 12

Lehman Brothers Scandal (2008)

August 30, 2017 13

Challenges are and will be created to ethics in managerial accounting

August 30, 2017 14

3.1 Importance of Business Ethics in Managerial Accounting

August 30, 2017 15

3.2 Consequences of Bad Ethical Accounting Practices

• What are the Consequences of Bad Ethical Accounting Practices?

August 30, 2017 16

Civil and Criminal Penalties

August 30, 2017 17

1. Balciu Diana Elisabeta. Etica si contabilitatea creativa. Abordari teoretice si evidente

2. Dan L. Heitger, Maryanne M. Mowen, Don R. Hansen Cengage Learning, 01.11.2007.

4. Greg Voakes, Hack CollegeNov. 19, 2012.INFOGRAPHIC: The 10 Worst Corporate

5. IMA Statement of Ethical Professional Practice. Available: https://www.imanet.org/-

6. John Freedman. Consequences of Bad Ethical Accounting Practices. Available:

10. Radell Hunter, Importance of Business Ethics in Managerial Accounting. Available:

August 30, 2017 18

También podría gustarte