ACCA Applied Knowledge · Business and Technology · Ethical conflicts and dilemmas
Tomas, an accountant at Delta Co, is pressured by the managing director to approve a misleading cash flow forecast for a lender. Tomas has raised the concern internally but the managing director refuses to change it, and the board takes no action. Which course of action is MOST appropriate next?
Tomas should get confidential advice from his professional body or a lawyer and consider whether he can stay associated with the forecast, possibly resigning. Signing it would breach integrity, and informally disclosing to the lender could breach confidentiality.
- ASign the forecast to preserve his job and document that he was pressured
- BObtain advice from his professional body or legal counsel, and consider whether he can remain associated with the forecastCorrect
- CSend the forecast to the lender with a private note of his concerns without telling anyone
- DWait until the lender discovers the problem
Explanation
After internal escalation fails, the accountant should seek confidential advice from the professional body or legal adviser, consider the legal duties of confidentiality and disclosure, and refuse to be associated with misleading information, which may mean resigning. Signing breaches integrity, and unauthorised disclosure may breach confidentiality.
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