week 7 ACCY 111 RJD Lecture 2

The costs may not be entirely economic there may be

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The costs may not be entirely economic. There may be human or ethical ‘costs’. There may also be non-economic benefits associated with providing political legitimacy to an organisation. Is there a statutory requirement to provide the information?
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A word on unethical behaviour Self-deception : “everybody does it”. Self-indulgence : a claim that it was done for someone else’s benefit when in fact you will benefit. Self-protection : Nick Leeson’s claimed his first illegal trade was done to cover up an error by a colleague – it grew to $16 billion. Self-righteousness : an assertion that you are right, no matter what others think. Faulty reasoning : the costs of being ethical (‘I will loose my job’) are overestimated while the costs of being unethical (‘I won’t get caught’ or ‘I will pay it back latter’) are underestimated.
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A word on ethics – NZICA Fundamental Principles Integrity Members must behave with Integrity in all professional and business relationships. Integrity implies not merely honesty but fair dealing and truthfulness. Objectivity and Independence Members must be fair, impartial and intellectually honest, and must not allow prejudice or bias, conflict of interest or influence of others to override Objectivity. Members undertaking certain types of engagements must be, and be seen to be, Independent. Competence Members must only undertake professional work in which they have the Competence necessary to perform the work to the technical and professional standards expected.
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A word on ethics – NZICA Fundamental Principles Quality Performance Members must perform their professional work with due care and diligence, ensuring that all professional obligations are completed in a timely manner and are carried out in accordance with the relevant technical and professional standards appropriate to that work. Professional Behaviour Members must act in a manner consistent with the good reputation of the profession and refrain from any conduct which might bring discredit to the profession.
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An “ethical cost”? Suppose you are a management accountant for a company seeking bids for a new contract. You know that costs and reliability of supply will be critical components of the successful bid. A potential supplier bidding for the contract, invites you to an all expenses paid trip to Auckland to watch the All Blacks from their corporate box at Eden Park.
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An “ethical cost”? Suppose you are a management accountant for the New Zealand Ministry of Fisheries. You are responsible for calculating and charging the levies that recover fisheries management costs from the commercial fishing industry. It’s Christmas and the chief executive of a fishing company offers a gift of a kilo of scallops to you and each of your staff.
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All Information Has a Cost It is also common for organisations to spend many thousands, if not millions, of dollars on information and communications technology.
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