Please reply of at least 150 words on this discussion and support the assertions with at least two scholarly citations in current APA edition format which must have been published within the last five years.
A. Can you justify what Charles did?
I cannot justify what Charles did. As an accountant we are held to a high standard as far as ethics. Charles graduated from a prestigious business school and worked for a public accounting firm. He knew what he was doing was wrong the first time he accomplished his mission to “find more sales” Ultimately, you can see that his ethical decisions are having a direct influence on the type of life he is likely to lead as his home life seems unstable. I do see how he could feel pressure to commit fraud and keep his job. External factors like family life and personal finances can sometimes cloud our judgement.
B. What could Charles have done to avoid the ethical dilemma that he faced? Assume that the company president would have made it impossible for Charles to work in Atlanta in a comparable job.
Charles should have used the IMA Code of Ethics discussion steps. First, he should have discussed the conflict with the board. Making them all aware of the behavior of the president. Second, he should have clarified the dilemma with someone that was not involved in the situation. Third, Charles should have talked to an attorney the first time he was asked to “find more revenue” If the president did make it impossible for Charles to work in Atlanta again then he should investigate something remote. We live in a world where there is no reason to only look locally for employment. If he was fired and had to take a job that paid less his child support and alimony payments can be reduced too. There is no excuse for unethical behavior.
C. What if the Securities and Exchange Commission discovered this fraud? Would Charles’s boss get in trouble? Would Charles?
Due to the Sarbanes-Oxley Act of 2002 Charles had to sign the financial statements. The CEO had too as well. Because he has signed that these financials are correct and not fraudulent, he could face prison time. In short, Yes Charles and his boss would get in trouble as they both signed the financials acknowledging that they believed them to be correct.