Factors affecting decision-making

This report addresses the ethical situation that has been caused by the CEO’s relocation movements from Adelaide to Brisbane. The situation is unethical and illegal with the following facts which have been identified in making the decision. First, this is an individual factor. This consists of personal moral philosophy which were applied in order to make a decision between right and wrong. Further-more, we considered consequentialism philosophy to support the decision because the reason of the situation seems to be of personal interest. The money that is spent on the stop overs of the CEO is not for the benefit of the company; it if for the benefit of the CEO’s family members. The second fact is the culture of the company. The company has goals, rituals and norms that shared among the members of the company. The culture of the company has stipulated kind of behaviours of the company members. This was based on to determine what is wright and what is wrong. The last principle is the superiors and stake holders of the company who are the overall controllers of the decision made.  

The stakeholders that are impacted by this situation are the financiers who include shareholders. A lot of money which would have been in for profits is consumed by the bills of the stop overs. Furthermore, the company is running without the control of the CEO which may lead the company to incur losses. The public is also impacted because where the CEO is and his family members know that he was transferred but he has not yet reported to the workplace and the expenses are not catered by him

The First Principle Is The Principle Of Autonomy This Principle Comprises Of Right Freedom Of Action As Well As Freedom Of Choice In This Accountant Has a Right To Gather Information but in doing so, the stake holders also have a right to be autonomous. The result of the decision made should not cause a financial impact to the stake holders. In this principle, the accountant needs to make a balance between the information got from the CEO’s independence to make stop overs and the decision made. Integrity is the second principle the is identified. In this we consider the processing of payments whether it is a fair act or being honest. Professional behaviour is identified which consists of the conduct of the members in the company. Another principle is Justice. This is applied by not considering the gender and where the CEO comes from and his family members. Fidelity is another principle which consists of keeping promises and that the information collected for the decision making is valid. This consists of the confidentiality of the information obtained so the it is not disclosed to third parties without permission from the authority.

Impact on stakeholders

However, due to psychological tendencies and decision-making biases affect the understanding of the situation by engaging in practices which consist of the world theories, theories concerning ourselves and those about other people. Our understanding of these theories is not in a proper form which creates a negative impact on the understanding of the situation. However, in order to over come this limitation, the tendencies must be identified and confronted in order to have an ethically and a successful decision-making (Messick and Bazerman, 1996).

If the situation is not addressed, the code of an independence provision may be breached. In case a breach of any of the other code’s provision is identified by the accountant, an evaluation for the breach significance shall be made by the member and the impact it has on the ability of the accountant’s compliance with fundamental principles. The accountant may either report the breach or oversight the authority.

The situation compromises the values and purpose of the company by creating unexpected bills which were not planned for. This also includes the misuse of the company time which was set for the running of certain activities that have to be controlled by the CEO, this lowers the productivity of the company and it may lose competition in the market due to lower production since workers need a driving force in order to do their duties. However, if this situation is known to the public, it could cause damage to the company’s self-respect and the respect of the company superiors who have to implement and maintain the concealment

Basing on the framework of the situation above, the situations might lose control of the executives of the company because the CEO’s stop overs are not taken seriously and yet he takes a lot of time at each stop over and each stop over is financed by the company. This an expense which is incurred without profits and the management of the company is not strong enough to produce products that can fit the needs of the stake holders. However, I recommend the implementation of a straightforward code of conduct that is set in the guidelines of the company’s operation of activities. This is followed by reminding the CEO of the company’s expectations of ethical behaviour that is expected of the executives and the stake holders. The values of the CEO need to be reviewed and find out whether he is fit to be the CEO of the company because his values might be controversial to the visions of the company.

Principles involved

By this data, an implementation plan is developed as shown below.

Further data needs to be collected. This consists of the effective communication between the company executives and the stakeholders. This considers whether the decision made considers the awareness of the situation by the public. Another data is the responsibility of each member of the company, the accountability of the bills of the stopovers and the financial statements of the company within those days that the CEO is not around and these need to be compared with the results of the previous financial statements. The professionalism of the CEO needs to be acquired in order to make proper decision whether he deserves to be the CEO or not. This has to be discussed with the Chief Financial Officer and the General Manager in order to look for a way forward towards the situation.

However, the issues that arise from the speaking has to be concealed to avoid adverse responses that may arise from the public. This information has to be confidential so that the public does not come to know about the ethical situation of the company. This consists of the need to keep the decision secret and the risk that the decision as well as its concealment might be disclosed. All of this is done to avoid the risk of the viewing of the decision by the public as stake holders. However, according to the code’s section 140 confidentiality, any member that gets access to a piece of information that is confidential during the provision of a professional service, must not disclose that information without permission from the authorities that are specific and proper. By the privacy act 1988, the disclosure of information concerning an individual is prohibited (APESB, 2012)

In the implementation of this decision making, I can proceed alone without a conjunction of a colleague because basing on the report drafted, it does not cover a wide range of aspects whereby the major issue of the decision-making is about the financial status of the company that the CEO does not care about what he is spending because he is not the one catering for those expenses yet they are for his own benefit and his family members but not of the company. This issue can be handled individually by considering the ethical mode of conduct of the company in relation to the finances and the effect it has on the stake holders.

Overcoming decision-making limitations

The situation has not been resolved yet because the general manager has not yet provided the approval for the implementation of the decision that was suggested in the previous report. The general manager had to guarantee the implementation to take place before the CEO had started operating his duties but the CEO is ordering a 10% rise in the payment of the staff before the investigation of the previous issues. This worsened the situation because the company was already in financial crisis and in addition to this, the expenses of the company became more than the income of the company. The issue that was addressed before was the extravagance of the CEO which he showed when he had not started operating and confirmed it by the 10% increment of the staff’s salary. If this situation had been resolved, this would not happen.

In this case of situation, further action is needed and the accountant shall carry out professional judgement and consider the third party in an appropriate public interest. One of the actions taken is providing the parent entity’s management with information of the matter if the organisation that employs is part of the group. Another action is the matter disclosure to the authority even in the situation of absence of legal or requirement of regulation to do so. Lastly is to resign from the organisation of employment.

However, in the disclosure of the matter to the authority, it was not considered the duty breach of confidentiality under this code’s section 140. The authorities did not take the matter serious. Still the issue was not solved.

The consequences of the action is the documentation matters which includes the matter, discussion results with accountant’s superior, the management and those concerned with governance and other personnel, the accountant’s superior response to the matter and the considerations of the course of action by the accountant, judgements made as well as decisions taken.

The outcome reveals my values to be ethical, guided by laws and regulations and follow the right path but those of the organisation are guided by the authorities who do not follow the code of conduct of the organisation.  

Future ethical situations can be approached through the use of three approaches. First is analysing consequences, analysing actions and then making a decision.

As a consequence of this outcome, I would take the actions that are listed in the code sections of 225 and 360 in the public interest. The accountant would inform an immediate superior so that the superior would take an immediate action. By this higher control of the matter, the situation can be handled so that the company is retrieved from the situation

References.

Accounting Professional and Ethical Standard Board (APESB). (2012). APES GN 40 ethical conflicts in the work place – considerations for members in business. 3 – 39

APESB. (2017). Compiled APES 110 code of ethics for professional accountants. 11-157.

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