Ethics

3. referring to the specific standards for ethical practice by a management accountant, assess the ethical issues in John Porter’s request of Lynn Hardt.

John Porter’s son-in-law, nephew and a friend works in the MTR-2000 department. He fears that outsourcing the MTR-2000 will cost the 3 of the people’s job in jeopardy. So he requested Lynn to perform fraud in the financial statement in order to save their jobs. John Porter’s attempt to persuade Lynn and cheat the organisation shows he is an irresponsible and selfish person. He just thinks in terms of his 3 friends and family instead of the growth and the future of the organisation. Lynn Hardt as a profit planner of the company should think about the cost effectiveness in every move he does. So he does the right choice by suggesting the organisation to outsource MTR-2000.As an ethical officer of Midwest he should follow competence. Competence is defined as the ability to do something successfully or efficiently. Which means he should analyse every single relevant and irrelevant information regarding the MTR-2000 department and the expenses incurred due to producing MTR-2000 compared with outsourcing MTR-2000.Finally he should prepare a clean, truth and independent report. Lynn possesses the position as profit planner in Midwest which is a very high position and he will be highly relied person in the company because he is the one who comes up with the idea to boost up the revenue. So he must have the quality of integrity where every management accountant should practice the ethical standard. As Paibec mentioned they want to lower their cost by the means of producing or outsourcing it.By viewing Lynn’s report only they can make a decision whether to make or purchase MTR-2000.If Lynn follows Porter’s advice and falsifies the information then he will lose the integrity as a profit planner of the organisation. Integrity means having the quality of being honest and strong moral principles. Lynn have to display all...