Ethical situation comprises of a selection that a professional makes as the best option from the available ones. This is based on a particular behavioral step in a given case (Frank, 2004). It comprises of collecting relevant facts, identifying the ethical issue, knowing the available alternatives, possible consequences and decision on appropriate step.
The ethical dilemma is Rita Lane providing Casey Henderson with the company’s last three years actual and standard costs for benchmarking. The "Statement of Ethical Professional Practice" requires management accountants to adhere to four ethical characters such as confidentiality, credibility, competence and integrity. The ethical dilemma concerns confidentiality, competence and integrity that is abused concerning the IMA standard of ethical practice. It relates Rita Lane disclosing the setting information for the benchmarks to Casey Henderson. Confidentiality is about sharing information to only intended and authorized personnel in the company- Rita Lane. The accountants should often keep private company's data and only provide to authorized persons when legally required (Gaumnitz & Lere, 2002). Moreover, management accountants must save themselves from using illegal means or undue advantage by using confidential information.
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Competence is about working effectively and efficiently in a situation. According to the IMA standard on competence, Rita Lane has the responsibility of keeping her expertise standard and improve her knowledge and skills. Nonetheless, she should work within the standards' framework, be reliable, accurate, timely and concise. On the other hand, integrity is about being unbiased and adhering strictly to moral values as per IMA standard to prevent conflict of interest.
The relevant factors include Casey Henderson’s firm deals in selling and collection of information willingly. Secondly, the companies providing their important data are assured that no disclosure of data occurs by the benchmarking firms. Nonetheless, Rita Lane provided no assurances on the matter to disclose the three years data. Moreover, Casey Henderson’s firm is new and thus, unable to render quality and maintain confidentiality.
The recommendations include Rita Lane should determine a standard cost that is competitive. The determination should undermine none of the company’s goals and ethics. Secondly, Rita Lane should recommend to the controller on how standard setting would be made easy and how benchmarking would ensure efficiency and cost controls in the operation of the company.
References
Gaumnitz, B. R., & Lere, J. C. (2002). Contents of codes of ethics of professional business organizations in the United States. Journal of Business Ethics, 35(1), 35-49.
Frank, R. H. (2004). What price the moral high ground?: ethical dilemmas in competitive environments. Tor/Forge.
