Suppose a Management Accountant Becomes Aware of a Confidential but Illegal

question 112

Essay

Suppose a management accountant becomes aware of a confidential but illegal act that has occurred within her company.The management accountant must consider what she is ethically bound to do about this situation.Three alternative responses to this situation are given below.State whether you agree or disagree with each,and briefly detail your reasons.
a.The accountant must remain loyal to the company at all times and should report the occurrence only to appropriate officials within the company.
b.The accountant is bound to inform officials only if she stands to personally gain (make money)from knowledge of the illegal act.
c.The accountant must exercise personal judgment;a clear-cut answer does not exist given the limited information provided.

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Definitions:

Differentiation

The process of distinguishing or creating differences between products, services, or concepts to make them more appealing to specific target markets.

Unique Competencies

Speaks to the distinct capabilities or skills that set an individual or an organization apart from competitors.

Organic Systems

Organizational structures characterized by flexibility, adaptability, decentralized decision-making, and a more holistic approach to management.

Hierarchy

A system or organization in which people or groups are ranked one above the other according to status or authority.