Final Exam Review

Final Exam Review - Chapter 3: Ethics, Fraud, and Internal...

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Chapter 3: Ethics, Fraud, and Internal Controls - Must balance risks and benefits to decide on a final result Ethical Issues in Business - Issues of right or wrong that are not universally agreed upon - Ethics : the principles of conduct that individuals use in making choices and guiding their behavior in situations that involve the concepts of right and wrong - Business ethics : the act of managers in deciding right and wrong and how they achieve it - Ethical responsibility : seeking a balance between consequences - Justice : benefits of the decision should be distributed fairly to those who share the risks - Computer ethics : impact on society dealing with computer crime, working conditions, privacy, technology and more - Three levels of computer ethics: o Pop: exposure to stories and reports found in popular media regarding the good or bad ramifications of computer technology o Para: a real interest in computer ethic cases and acquiring some level of skill and knowledge in the field o Theoretical: multidisciplinary researchers who apply the theories of philosophy, sociology, and psychology to computer science with the goal of bringing some new understanding to the field - Privacy : people desire to be in full control of what and how much information about themselves is available to others, and to whom it is available - Ownership : maintenance of shared databases to protect people from potential misuse of data - Security : an attempt to avoid such undesirable events as a loss of confidentiality or data integrity Access: - Cultural limits with translation policies - More comforting to have a hard copy of a document, but not environmentally friendly - Using company computer’s for personal benefits, other computer misuses include copying proprietary software and snooping through other people’s files SOX and Ethical Issues: - Most significant securities law designed to deal with specific problems relating to capital markets, corporate governance, and the auditing profession Section 406 - Code of Ethics for Senior Financial Officers - Requires companies to disclose to the SEC whether they have adopted a code of ethics that applies to the organization’s CEO, CFO, controller, or persons performing similar functions - Applies directly to executive and financial officers of a company
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- Conflict of interest: outline procedures for dealing with actual or apparent conflicts of interest between personal and professional relationships - Full and Fair Disclosure : timely and understandable disclosure in documents, reports, and financial statements that it submits to the SEC (In the past companies used overly complex and misleading accounting techniques to hide questionable activities) - Legal Compliance : require employees to follow applicable governmental laws, rules, and regulations - Proper internal reporting of ethics and violations Fraud and Accountants - Fraud : denotes a false representation of a material fact made by one party
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Final Exam Review - Chapter 3: Ethics, Fraud, and Internal...

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