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ACCA Applied Knowledge · Business and Technology · Ethical conflicts and dilemmas

Priya, a management accountant, is offered an expensive holiday by a supplier who is bidding for a large contract that she helps to evaluate. Which type of threat to the fundamental principles does this MOST clearly create?

This creates a self-interest threat. Priya would receive a personal benefit from a bidder whose proposal she helps evaluate, which could compromise her objectivity. There is no pressure, so it is not intimidation, and no review of her own work, so it is not self-review.

  1. ASelf-review threat
  2. BIntimidation threat
  3. CFamiliarity threat only because she has known the supplier for years
  4. DSelf-interest threatCorrect

Explanation

A personal financial or other benefit from a party affecting her judgement creates a self-interest threat to objectivity. No one is pressuring her, so it is not intimidation. Self-review arises when evaluating one's own earlier work, and nothing in the scenario says a long relationship exists, so familiarity is not indicated.

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