Question

Think about your field of study and share a hypothetical scenario of an ethical dilemma that could be faced by a managerial accountant within this field. Discuss the course of action the accountant should take to address this ethical question in accordance with IMA Statement of Ethical Professional Practice.

Answer 1

Mangement accountant should serve the best the bests of the organisation. However there maye a situation where in his personal interests conflicts with the interests of his organisation. This is an ethical dilemma to him.

For instance, adverse outcomes due to recommendations made by the management accountant can be bad for any organisation. Thus may be due to lack of competency and knowledge in the management accountant. However in order to play safe and protect his personal interest me say conceal the information or manipulate it such that no proper information is fairly and truly communicated ot the stake holders.

Thus in the above case we can observe the following ethical issues:

• Conflict of personal interest and the organization's.
• Lack of competency. (Ie poor planning)
• Lack of objectivity (ie serving interest of the stakehodlers)
• Lack of Integrity (deliberate mistatement)

The accountant in order to tackle such ethical dilemmas should take following measures to be ethically diligent:

• Not accept the engagement when he doesnt posess the required skills and competencies.
• Use external help for technical issues (after consulting and obtaining approval from authorities)
• Communicate full information to the stake holders completely, truly and fairly.