The best thing that Charles could have done to avoid the ethical dilemma he faced when recording the illegitimate sales

Question 1 

The decision by Charles to record the illegitimate sales as recorded by the president is justified because he was facing a dilemma that was threatening his personal life and career. Even though he was not willing to engage in accounting malpractice, he was forced by the circumstances and situations he was facing. Charles could not afford to resign and lose his job because he wanted to be close to his family and earn enough money to take care of the children, especially after a costly divorce. According to Stolowy and Breton (2004), accounting manipulation is not a new thing, and it is a practice that is common in many companies. Mostly, companies have pre-determined financial targets that should me met annually, and top management and accountants are under presser to achieve the goal ( Bhasin, 2016) . At the same time, financial statement manipulation is a practice that continues to be witnessed in many companies across the globe. Nonetheless, even though Charles was cornered and he had to manipulate sales records, he still had the option of resigning and adhering to the ethical requirements. He could have agreed to face the consequences, although this was a tough decision to make. 

Question 2 

The best thing that Charles could have done to avoid the ethical dilemma he faced was to approach the president of the company and tell him the truth. Charles could have been brave enough to tell the president that he has exhausted all legitimate ways of reducing cost and increasing revenues. Even though this would have prompted the president to sack him and make it impossible for Charles to find a job in Atlanta, he could have made an ethical decision. Besides, Charles was a qualified accountant who could get a job in another reputable and well-established company in Atlanta or a nearby state or town. Alternatively, to avoid ethical dilemma that Charles faced, he could have resigned and sought another job, even if not in Atlanta. Resignation is a sign of integrity, particularly when an employee is facing an ethical dilemma like in the case of Charles ( Dobel, 2012) . Charles should not allow the president’s threat to stop him from making ethical decisions. 

Question 3 

One of the main roles of the Security and Exchange Commission (SEC) is to protect investors by ensuring that the financial market works fairly. The financial market is expected to be honest and fair to investors. At the same time, SEC ensures that companies do not manipulate financial records to benefit a few individuals at the expense of investors ( Poser, 2009) . Therefore, both Charles and Holmes would be in trouble if SEC discovers the fraud. Holmes will be in trouble for ordering Charles to manipulate sales records to meet the financial target. At the same time, Charles has the personal responsibility to ensure that he adheres to the accounting rules and regulations, especially concerning financial reporting. 

Facing Similar Situation 

I have never encountered similar situations as in the case of Charles. However, I have worked in a company where accounting employees are under pressure to meet the set financial target. Nevertheless, the employees were not subjected to severe threats such as losing jobs and ensuring that they did not work in the area. Employees were just encouraged to make sure that the financial records were favorable to the management. 

References 

Bhasin, M. L. (2016). Accounting Manipulation Practices in Financial Statements: An Experience of an Asian Economy. International Journal of Economics and Financial Research , 2 (11), 199-214. 

Dobel, J. P. (2012). The ethics of resigning. Journal of Policy Analysis and Management: The Journal of the Association for Public Policy Analysis and Management , 18 (2), 245-263. 

Poser, N. S. (2009). Why the SEC Failed: Regulators Against Regulation. Brooklyn Journal of Corporate, Financial & Commercial Law , 3(2). 

Stolowy, H., & Breton, G. (2004). Accounts manipulation: A literature review and proposed conceptual framework. Review of Accounting and Finance , 3 (1), 5-92.