Distinguish between financial accounting and managerial accounting as to user groups and time horizons. Why should the chief accountant of an organization have a clear understanding of both financial and managerial accounting?How did the internal control procedure of separation of duties fail to detect the fraudulent behavior in problem 1-28b on page 51?Consider the elements of the fraud triangle and explain how each element is present in this problem. 2:29 AM Sun Dec 11=Cumal Conduct, the institute of Management marts (1) But theTo provide management accountants with guruanvv IUTStatement of Ethical Professional Practice, which is shown in Exhibit 1.17. Management accountants are also frequently required toabide by organizational codes of ethics. Failure to adhere to professional and organizational ethical standards can lead to personaldisgrace, loss of employment, or imprisonment.BCompetence Each member has a responsibility toMaintain an appropriate level of professional expertise by continually developing knowledge and skills.EXHIBIT 1.17Statement of Ethical Professional PracticeMembers of IMA shall behave ethically. A commitment to ethical professional practice includes overarching principles that express our valuesstandards that guide our conduct. IMA's overarching ethical principles include: Honesty, Fairness, Objectivity, and Responsibility. Members shin accordance with these principles and shall encourage others within their organizations to adhere to them. A member's failure to comply wifollowing standards may result in disciplinary action.Confidentiality Each member has a responsibility toKeep information confidential except when disclosure is authorized or legally required.•●●●●Perform professional duties in accordance with relevant laws, regulations, and technical standards.• Provide decision support information and recommendations that are accurate, clear, concise, and timely.Recognize and communicate professional limitations or other constraints that would preclude responsible judgment or successful performof an activity.·Integrity Each member has a responsibility toMitigate actual conflicts of interest and avoid apparent conflicts of interest. Advise all parties of any potential conflicts.Refrain from engaging in any conduct that would prejudice carrying out duties ethically.• Abstain from engaging in or supporting any activity that might discredit the profession.•a. AA.Inform all relevant parties regarding appropriate use of confidential information. Monitor subordinates' activities to ensure compliance.Refrain from using confidential information for unethical or illegal advantage.Credibility Each member has a responsibility toCommunicate information fairly and objectively.Disclose all relevant information that could reasonably be expected to influence an intended user's understanding of the reports, analyserecommendations.Disclose delays or deficiencies in information, timeliness, processing, or internal controls in conformance with organization policy and/orapplicable law.●●●Resolution of Ethical Conflict In applying these standards, you may encounter problems identifying unethical behavior or resolving an ethicconflict. When faced with ethical issues, follow your organization's established policies on the resolution of such conflict. If these policies doresolve the ethical conflict, consider the following courses of action:• Discuss the issue with your immediate supervisor except when it appears that the supervisor is involved. In that case, present the issue tonext level. If you cannot achieve a satisfactory resolution, submit the issue to the next management level. Communication of such problenauthorities or individuals not employed or engaged by the organization is not considered appropriate, unless you believe there is a clearviolation of the law.The Fraud TriangleUnfortunately, it takes more than a code of conduct to stop fraud. People frequently engage in activities that they know are unethical oreven criminal. The auditing profession has determined that the following three elements are typically present when fraud occurs:1. The availability of an opportunity.2. The existence of some form of pressure leading to an incentive.3. The capacity to rationalize.The three elements are frequently arranged in the shape of a triangle as shown in Exhibit 1.18.Clarify relevant ethical issues by initiating a confidential discussion with an IMA Ethics Counselor or other impartial advisor to obtain a betunderstanding of possible courses of action.Consult your own attorney as to legal obligations and rights concerning the ethical conflict.Source: Institute of Management Accountants, Inc.EXHIBIT 1.18Back To PagePage_21

Note: “Since you have posted multiple questions, we will provide the solution only to the first…

Answered: Distinguish between financial…

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q