Ethics for Management Accountants Paper 5


Quentin Jam is a new accountant assisting in the month-end close of the books for Sheldrake, Ltd. His supervisor told him to accrue a large receivable and said that he would provide the supporting documentation later. Jam made the accrual, and the books were closed. Subsequently, Jam found out that the company would have missed the earnings estimate without the receivable. Jam requested the documentation, but the supervisor could not provide it. Other associates told Jam that this supervisor had directed that undocumented entries be recorded in the books in the past and that the former accountant had left Sheldrake because he was uncomfortable making the entries. Recommend the best course of action for Jam.


Games Unlimited has convened a group of employees to review the company’s code of ethics and propose revisions and improvements. One of the suggested improvements is the development of a whistleblowing framework as recommended by IMA’s Statement on Management Accounting, “Values and Ethics: From Inception to Practice.” This framework will provide all of the following benefits except


The management team of GranMark, Inc., attended an ethics training session at the IMA Annual Conference and subsequently made plans to enhance GranMark’s ethics program. The president plans to chair a committee of employees to review the company’s behavioral values, while the CFO intends to review the ethical standards applicable to the Finance Department. The manager of the Human Resources Department will investigate the feasibility of establishing a whistleblowing framework that includes a “hotline” for reporting ethics violations. These activities at GranMark exemplify


In order for an ethics code to become a reality in practice, every aspect of a company’s activity should be affected by the code. Ethical behaviors should focus not only on clients and customers but also on employees, society at large, shareholders, and suppliers. All activities, from design and development through after-sales support and services, should also be considered when applying a company’s ethical principles. When focusing on society at large, ethical considerations would most likely include


Which one of the following ethics-related actions by management is least effective in encouraging acceptance by employees of an organization’s code of ethics?


Misappropriation of assets is most often perpetrated by


Inappropriate earnings management is typically considered one form of


When none of the three fraud risk factors are present, an accountant


Management is often able to rationalize the commission of fraud by


High risk of employee fraud is most likely when there is pressure, rationalization, and


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