83.
Explain what is meant by the ethical-person organization exchange and ethical dissonance
including its implications for workplace ethics.
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84.
An Internet Company has a chance to expand its business into a developing country. This
opportunity if executed would make money for the shareholders, as it would be the first
Internet Company allowed in the country. However, the conditions demanded by the
country includes that the company must turn over to the government the history of
Internet sites visited by its citizens. Additionally, the Internet Company must also censor
Internet sites requested through the search engine. In the United States and other
countries, the Internet Company would not monitor, censor, or turn over a history of
Internet sites to any government.
What should the Internet Company do? Use ethical theories and ethical decision making
model to back up your decision.
3-57
85.
Lana is a CPA and works as an internal auditor for Dynamite, Inc. As she was performing a
revenue timing test, for the internal audit schedule and the external auditors, she noticed
that the Western division consistently kept the books open 4 days into the next quarter.
Lana immediately reported to the Chief Internal Auditor; together they took the issue to
the CFO and Controller. The CFO assured them that the issue would be resolved. It has
been 90 days since the meeting. Lana is considering blowing the whistle but cannot
decide who to tell and when.
What are the ethical issues of concern for Lana? What would you advise Lana to do, how,
to whom and in what order, assuming she could qualify for a reward under Dodd-Frank?
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86.
Kyle and Luis were friends since rooming together in college ten years ago. They were
both finance and accounting double majors. They were each other’s weddings and their
wives were also good friends. After college Kyle went on to get his CPA license and
ultimately went to work as controller, and then CFO, of a publicly held hardware chain,
King’s Hardware. King’s had twenty-five retail outlets in a five state region and looking at
acquiring a hardware chain (Rex’s) of six retail outlets in a state that King’s wants to get a
presence in. Luis worked for a bank after college but then changed to being a real estate
investor. Luis was the one who gave Kyle the tip on Rex’s being open to a takeover offer;
Luis was the realtor for all of Rex’s store locations.
Kyle hired a CPA firm to do due diligence for the acquisition, including updated appraisals
of Rex’s store locations and valuations of contents of each store. Kyle had the report. The
problem was that the report is showing that Luis was a 10% owner of Rex’s; would be paid
a 15% commission by Rex’s upon a successful buy-out; and, most troubling of all, the
value of Rex’s locations and inventory was overstated on Rex’s books by 50%.
Kyle is considering who to tell, how, when. Most of all he is feeling betrayed by Luis.
1. What are the ethical issues?
2. What would you do next and why? Consider the following in your response.
• What do you need to say, to whom, and in what sequence?
• What are the reasons and rationalizations you are likely to hear from those who would try
to detract you from your goal?
• How can you counteract those pressures? What is your powerful and persuasive
response to these arguments? To whom should you make them? When and in what
context?
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87.
Imagine you just went to your local pharmacy and were told that the cost of a life-saving
drug was $22,500 for 30 tablets to treat AIDS or another infectious disease. Well, if you
needed the drug Daraprim that is what you would have to pay according to the CEO of the
company that manufactured it. Turing Pharmaceuticals purchased the right to Daraprim in
August 2015 and CEO Martin Shkreli decided a price increase of 5500% was needed.
Evaluate the ethics and corporate responsibility in Shkreli’s decision to charge the $22,500
for 30 tablets.
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88.
Explain how an ethical workplace culture can be best established.
Corporate culture is the shared beliefs of top managers in a company about how they
should manage themselves and other employees, and how they should conduct their
business. An important element of ethical culture is the tone at the top. Tone at the top
refers to the ethical environment that is created in the workplace by the organization’s
leadership. An ethical tone creates the basis for standards of behavior that become part of
the code of ethics.
