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Chapter 1 Discussion Questions
Suggested Discussion and Solutions
1. A common ethical dilemma used to distinguish between philosophical reasoning
methods is the following. Imagine that you are standing on a footbridge spanning
some trolley tracks. You see that a runaway trolley is threatening to kill five people.
Standing next to you, in between the oncoming trolley and the five people, is a
railway worker wearing a large backpack. You quickly realize that the only way to
save the people is to push the man off the bridge and onto the tracks below. The
man will die, but the bulk of his body and the pack will stop the trolley from
reaching the others. (You quickly understand that you can’t jump yourself because
you aren’t large enough to stop the trolley, and there’s no time to put on the man’s
backpack.) Legal concerns aside, would it be ethical for you to save the five people
by pushing this stranger to his death? Use the deontological and teleological
methods to reason out what you would do and why.
Is it Ethical to Save Five People at the Expense of One?
Lessons from the Talmud
The Trolley Problem is a thought experiment in ethics, first introduced by Philippa Foot
in 1967. Others have also extensively analyzed the problem including Judith Jarvis
Thomason, Peter Unger, and Frances Kamm as recently as 1996. The authors used these
problems in ethics class to challenge students’ moral intuition.
The choice is between saving five lives at the cost of taking one life. Before we get to the
“answers,” we want to explain how one researcher is using MRI technology to map brain
response while analyzing the dilemma. Joshua Greene at Harvard University was more
as well say you killed a man. How could you forgive yourself? The man has a family and
people who love him, so how could you explain your actions to his family?
We have no right to sacrifice the life of one person to save others. There is a saying from
the Talmud, an authoritative record of rabbinic discussions on Jewish law, Jewish ethics,
customs, legends and stories: “Whoever destroys a soul, it is considered as if he
destroyed an entire world. And whoever saves a life, it is considered as if he saved an
entire world.”
2. Another ethical dilemma deals with a runaway trolley heading for five railway
workers who will be killed if it proceeds on its present course. The only way to save
these people is to hit a switch that will turn the trolley onto a side track, where it will
run over and kill one worker instead of five. Ignoring legal concerns, would it be
ethically acceptable for you to turn the trolley by hitting the switch in order to save
five people at the expense of one person? Use the deontological and teleological
methods to reason out what you would do and why.
Again, like above in number 1 you should not intentionally take a life, but if your
intentions were to save four people at the sacrifice of one life, and if you were unaware of
3. The following two statements about virtue were made by noted
philosophers/writers:
1. MacIntyre, in his account of Aristotelian virtue, states that integrity is the
one trait of character that encompasses all the others. How does integrity
relate to, as MacIntrye said, “the wholeness of a human life”?
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Integers are whole numbers. This is the base word for integrity. Things with
integrity are the same all the way through, or whole throughout. Thus, integrity
equates with the consistency of one’s actions. We must be consistently ethical to
become an ethical person. If we can assume that everyone knows good treatment
of their own interests and everyone knows good choices for their own short run,
integrity might mean applying those same best choices to situations which affect
others or affect the long run of all concerned.
2. David Starr Jordan (1851–1931), an educator and writer, said, “Wisdom is
knowing what to do next; virtue is doing it.” Explain the meaning of this
phrase as you see it.
This quote addresses the fact that it is not enough to know what is right or wrong;
one must also act on that knowledge. Knowledge without action would be hollow.
The well-known author Maya Angelou (1928 – 2014) has said that “Courage is
the most important of all the virtues, because without courage you can’t practice
any other virtue consistently. You can practice any virtue erratically, but nothing
consistently without courage.”
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4. 1. Do you think it is the same to act in your own self-interest as it is to act in a
selfish way? Why or why not?
Acting selfishly and in your own self-interest are not the same thing. Normally,
acting selfishly is only being concerned with self, not others, and being very short
sighted; it is being concerned with immediate gratification of some sort. Acting in
one’s best interest may also mean acting in the best interest of all involved. For
instance, I can turn up the television loud while I study because that is what I like,
2. Do you think “enlightened self–interest” is a contradiction in terms, or is it a
valid basis for all actions? Evaluate whether our laissez-faire, free-market
economic system does (or should) operate under this philosophy.
“Enlightened self–interest” may seem like a contradiction in terms. Nevertheless,
an individual has to be “enlightened” to consider the long term effects of a choice
upon self, others, and the whole of humanity. For example, an individual may
want the road near his house to be free of litter out of self-interest (resale value,
dislike of clutter and untidiness, etc.), but can extend that desire to wanting all the
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5. In this chapter, we have discussed the Joe Paterno matter at Penn State. Another
situation where a respected individual’s reputation was tarnished by personal
decisions is the resignation of David Petraeus, former U.S. military general and
head of the Central Intelligence Agency (CIA). On November 9, 2012, Petraeus
resigned from the CIA after it was announced he had an extramarital affair with a
biographer, Paula Broadwell, who wrote a glowing book about his life. Petraeus
acknowledged that he exercised poor judgment by engaging in the affair. When
Federal Bureau of Investigation (FBI) agents investigated the matter because of
concerns there may have been security leaks, they discovered a substantial number
of classified documents on her computer. Broadwell told investigators that she
ended up with the secret military documents after taking them from a government
building. No security leaks had been found. In accepting Petraeus’s resignation,
President Obama praised Petraeus’s leadership during the Iraq and Afghanistan
wars and said: “By any measure, through his lifetime of service, David Petraeus has
made our country safer and stronger.” Should our evaluation of Petraeus’s lifetime
of hard work and Petraeus’s success in his career be tainted by one act having
nothing to do with job performance?
Although at first glance adultery had nothing to do with Petraeus’ job, an officer in the
military is subject to the Uniform Code of Military Justice (UCMJ). Under article 133 an
officer can be court-martialed for conduct unbecoming to an officer and a gentleman.
Article 134-2 identifies adultery as an act unbecoming to an officer and a gentleman. The
timing of the affair between Broadwell and Petraeus is not known, but many have opined
that had the affair been during his time as general he would have been subject to court-
martial and possibly dishonorably discharged from the Army.
Conduct unbecoming to an officer and a gentleman is premised upon the fact that leaders
cannot be seen as willing to violate their own rules, principles and those of the
organizations they represent.
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6. One explanation about rights is that “there is a difference between what we have the
right to do and what is the right thing to do.” Explain what you think is meant by
this statement. Do you believe that if someone is rude to you, you have a right to be
rude right back?
Having a right to do something allows one to be concerned with one’s self interest only
(egoism). Doing the right thing often requires one to consider others besides and before
one’s self (at a minimum enlightened egoism, but also utilitarianism, deontology, justice,
7. Steroid use in baseball is an important societal issue. Many members of society are
concerned that their young sons and daughters may be negatively influenced by
what apparently has been done at the major league level to gain an advantage and
the possibility of severe health problems for young children from continued use of
the body mass enhancer now and in the future. Mark McGwire, who broke Roger
Maris’s 60-home-run record, initially denied using steroids. He has never come close
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to the 75 percent positive vote to be in the Hall of Fame. Unfortunately for
McGwire, his approval rating has been declining each year since he received 23.7
percent of the vote in 2010 and only 10 percent of the sportscasters voted in 2015 to
elect him into the Hall. Some believe that Barry Bonds and Roger Clemens, who
were the best at what they did, should be listed in the record books with an asterisk
after their names and an explanation that their records were established at a time
when baseball productivity might have been positively affected by the use of
steroids. Some even believe they should be denied entrance to the baseball Hall of
Fame altogether. The results for Bonds (36.8 percent) and Clemens (37.5 percent) in
their third year of eligibility (2015) were not close to meeting the 75 percent
requirement, and that led some to question whether these superstars would ever be
voted into the Hall. Evaluate whether Bonds and Clemens should be elected to the
Hall of Fame from a situational ethics point of view.
Using steroids is cheating. What theories would support cheating? Virtue ethics
emphasizes that doing the right thing should become a habit. Deontology would
emphasize the duty of doing the right thing. Fairness would emphasize equals competing
against one another on a level playing field. When athletes compete against one other,
each one should have the same advantages and disadvantages. Another concern with
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8. Your best friend is from another country. One day after a particularly stimulating
lecture on the meaning of ethics by your instructor, you and your friend disagree
about whether culture plays a role in ethical behavior. You state that good ethics are
good ethics, and it doesn’t matter where you live and work. Your friend tells you
that in her country it is common to pay bribes to gain favor with important people.
Comment on both positions from a relativistic ethics point of view. What do you
believe and why?
The basic moral principles of respect, fairness and kindness are timeless and worldwide;
although different circumstances can affect how they are implemented. There have to be
certain ways of treating people that almost always hurt and are almost always wrong; you
might mention a few obvious ones, like robbery, rape, and murder. Likewise, there are
cultural practices of great importance without moral significance. An example is which
side of the road you drive on. Left and right sides might be morally equal, but once
everyone promises to drive on the left side, the wrong side becomes promise-breaking
and deadly. Playing “football” in any country besides the United States implies a promise
not to use one’s hands, and doing so would be considered cheating. Touching the ball and
9. Hofstede’s Cultural Dimensions in Exhibit 1.2 indicate that China has a score of
only 20 in Individualism, while the U.S. score is 91. How might the differences in
scores manifest itself when the public interest is threatened by harmful actions
taken by a member of management who has direct control over an employee’s
standing within the organization? Should cultural considerations in this instance
influence ethical behavior?
Individualism (IDV) focuses on the degree that the society reinforces individual or
collective achievement and interpersonal relationships. In individualist societies (high
IDV), people are supposed to look after themselves and their direct family, while in
collectivist societies (low IDV), people belong to “in–groups” that take care of them in
exchange for loyalty. Imagine, for example, you are the manager of workers from
10. 1. What is the relationship between the ethical obligation of honesty and truth
telling?
Ask Students to differentiate between telling a lie and breaking a promise. List
some lies no one believes and therefore are not very harmful and list some lies
that people might believe and thus could be hurt by believing them. List some
promises no one believes and some people might believe and could count on, to
their detriment.
Have we sometimes “promised” to tell the truth and other times “almost warned”
people that we weren’t going to tell the truth? Telling the truth reveals our respect
2. Is it ever proper to not tell someone something that he or she has an
expectation of knowing? If so, describe under what circumstances this might
be the case. How does this square with rights theory?
First, ask students if there is a difference between the expectations of knowing
versus the right to knowing. For example, as college students their parents may
have an expectation of knowing their grades; however, unless the students are
dependents of their parents, the parents do not have a right to know the students’
grades.
The conflict of not telling someone something that he may have a right to know is
a choice between two rights. This situation may cause a person to tell a lie. For
example, assume John works in payroll for PQR Inc. PQR has announced that it
will be laying off 100 people from its workforce. Due to the need to prepare all
the separation paperwork and final payroll for the employees being laid off, John
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11. Is there a difference between cheating on a math test, lying about your age to
purchase a cheaper ticket at a movie theater, and using someone else’s ID to get a
drink at a bar?
All are examples of lying and affect one’s character through honesty and integrity. Many
will use many rationalizations to justify the lying. Some may try to split hairs between
what is wrong and what is more wrong – an ethical relativistic approach that should not
12. Do you think it is ethical for an employer to use social media information as a factor
when considering whether to hire an employee? What about monitoring social
networking activities of employees while on the job? Be sure to use ethical reasoning
in answering these questions.
Social media is one of the most popular forms of communication, particularly with
Millennials. Anyone can connect with anyone else, or find information about others that
may not otherwise be available. Thus, it should not be surprising if firms use social media
CareerBuilder found in a 2014 survey that 43% of hiring managers who research
candidates said they had found information on social media that caused the firm not to
hire the candidate. What qualifies as a valid reason to do so?
A platform like LinkedIn allows a firm to fact-check a candidates’ resume or CV. The
firm may find out that a candidate lied on their application about qualifications,
experiences or other information. This information may cause the firm not to hire the
candidate. However, other social media platforms may include pictures, statuses, and
likes about illegal activity, bullying, a criminal past, or posts that include racism, sexism,
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On the other hand, if the employee is seeking a job with a government entity, the
standards may be stricter because of the need to take care not to express one’s opinion on
controversial matters that may pertain to the work of the agency, albeit not directly
related to a specific matter before the agency. In this case it is important for the
employee’s statements not to appear to reflect the agency’s position on the matter.
We believe candidates should know that in today world one’s prospective employer may
be searching the Internet for character-based information on candidates for positions. It is
the candidate’s personal responsibility to act appropriately and be cautious about what
they say on the Internet. From a rights and virtue perspective, the firm should notify
candidates that it will be researching their backgrounds on social media.
13. In a 2014 segment of Shark Tank, Trevor Hiltbrand, the founder of nootropic
supplement maker Cerebral Success, sought funding from the “Sharks” to
introduce a line of nootropic shots to be sold on college campuses in Five Hour
Energy-style containers, but encountered some pushback from some of the Sharks
who questioned the ethics of marketing to stressed-out, sleep-deprived college
students anxious to get good grades. Should it matter if Hiltbrand was trying to
capitalize on the need to gain a competitive edge in college by selling something that
may not have received FDA approval?
Nootropics are an emerging class of drugs that are designed to enhance cognitive
functions. Many supplements may also tout that they increase focus, alertness and well–
being. Many nootropics supplements have had limited studies in humans, and could cause
many side effects.
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14. According to Adam Smith’s The Wealth of Nations, when it comes to government
oversight in the free market and regulations, the less intervention, the better. Does
the government play an important role in encouraging businesses to behave in an
ethical manner? Explain the basis for your answer. What role do environmental
laws have in a capitalistic system?
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The free market assumes that all players will be ethical and act in the best interest of the
market, or community. However, the players are human, tempted by greed, that do not
always act ethically or in the best interest of the markets and community. Then the
government steps in with laws that set a minimum level of ethics and starts regulating the
players. The basis for the government stepping in is utilitarianism and to protect the
rights of the public.
15. According to the 2011 National Business Ethics Survey conducted by the Ethics
Resource Center, Generational Differences in Workplace Ethics, a relatively high
percentage of Millennials consider certain behaviors in the workplace ethical when
compared with their earlier counterparts. These include:
• Use social networking to find out about the company’s competitors (37%),
• “Friend” a client or customer on a social network (36%),
• Upload personal photos on a company network (26%),
a. Choose one or more behaviors and explain why Millennials might view the behavior
as ethical.
Many of the behaviors are done out of egoism or the rationalization that “everyone is doing it” or
“I’m doing this so I can do my job better.” For example, “friending” a client or customer on a
b. Choose one or more behaviors and explain why you think it is unethical.
Use ethical reasoning to support your points of view.
Have the students discuss which of the above behaviors can be defended by virtue, deontology
and utilitarian (both rule and act) theories. The students might pick to “friend” a client or
16. How should an accounting professional go about determining whether a proposed
action is in the public interest?
Through the Securities and Exchange Act of 1934, the U.S. government effectively
awarded a professional monopoly to CPAs, in return for their commitment to protect the public
interest by acting as independent watchdogs over publicly traded corporations. Auditors serve as
gatekeepers who protect the interests of stakeholders through monitoring activity within the
17. Distinguish between ethical rights and obligations from the perspective of accountants
and auditors.
Ethical rights describe how a person is entitled to be treated by another person. Ethical
obligations are the duties to treat others in an ethical manner. Ask students what they think are
their rights. Now which of those rights have an ethical basis? Have the students make a list of
their ethical rights. If a student’s ethical right conflicts with the student’s ethical obligation, what
should a student do?
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18. Using the concept of justice, evaluate how an auditor would assess the equality of
interests in the financial reporting process.
Justice as fairness is the basis of the objectivity principle in the AICPA Code that establishes a
standard of providing unbiased financial information. In our discussion of ethical behavior in this
19. Why is it important for a CPA to promote professional services in an ethical manner?
Do you believe it would be ethical for a CPA to advertise professional services using
testimonials and endorsements? Why or why not?
Professionalism and work ethic are important qualities of accounting professionals.
Professionalism is generally defined as the strict adherence to courtesy, honesty, and
responsibility when dealing with individuals or other companies in business and clients in public
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20. Do you think it would be ethical for a CPA to have someone else do for her that which
she is prohibited from doing by the AICPA Code of Professional Conduct? Why or why
not? Do you think a CPA can justify allowing the unethical behavior of a supervisor by
claiming, “It’s not my job to police the behavior of others?”
It would be unethical for a CPA to employ (whether paid or not) someone to perform an act that
the CPA is prohibited from doing? It is using a proxy to do something that she knows is wrong.
Having someone else do the wrong act does not change the wrongness of the act. The AICPA
21. Assume in the DigitPrint case that the venture capitalists do not provide additional
financing to the company, even though the accrued expense adjustments have not been
made. The company hires an audit firm to conduct an audit of its financial statements to
take to a local bank for a loan. The auditors become aware of the unrecorded $1 million in
accrued expenses. Liza Doolittle pressures them to delay recording the expenses until after
the loan is secured. The auditors do not know whether Henry Higgins is aware of all the
facts. Identify the stakeholders in this case. What alternatives are available to the auditors?
Use the AICPA Code of Professional Conduct and Josephson’s Six Pillars of Character to
evaluate the ethics of the alternative courses of action.
The stakeholders in the DigitPrint case are the stockholders and employees of the company, the
local bank, suppliers and customers of the company. The auditors may try to get Doolittle and
Higgins to record the expenses; tell the board of directors of the situation; issue a qualified or
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22. In the discussion of loyalty in this chapter, a statement is made that “your ethical
obligation is to report what you have observed to your supervisor and let her take the
appropriate action.” We point out that you may want to take your concerns to others. The
IMA Statement of Ethical Professional Practice includes a confidentiality standard that
requires members to “keep information confidential except when disclosure is authorized
or legally required.”
23. Do you think there are any circumstances when you should go outside the company to
report financial wrongdoing? If so, to what person/organization would you go? Why? If
not, why would you not take the information outside the company?
Questions 22 and 23 were inadvertently separated in production of the book so we answer them
together.
Whistle blowing has had a bad name since before Rolf chose his duty to Nazi youth over his
affection for the Von Trapp family in the “Sound of Music.” Telling on someone to prevent
serious harm to someone else is usually called tattling. Tattling often has the bad reputation due
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24. Assume that a corporate officer or other executive asks you, as the accountant for the
company, to omit or leave out certain financial figures from the balance sheet that may
paint the business in a bad light to the public and investors. Because the request does not
involve a direct manipulation of numbers or records, would you agree to go along with the
request? What ethical considerations exist for you in deciding on a course of action?
Would the omission of the information be misleading to investors and the public? If so, then the
SEC would consider that information material and then should be disclosed. Many may consider
the omission of information as a form of a lie. One may mislead by stating a lie or by keeping
25. Sir Walter Scott (1771–1832), the Scottish novelist and poet, wrote: “Oh what a tangled
web we weave, when first we practice to deceive.” Comment on what you think Scott meant
by this phrase.
Lies often require stories which seem simple, but if examined, may call for further lies. In some
cases, merely remembering a lie is more difficult than remembering the truth. Fiction is filled
with stories of one lie leading to others. You might collect a list of those famous stories. This
question provides an opportunity to remind students of the ethical slippery slope and once a lie is
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26. Assume you are interviewing for a position with an accounting firm and the recruiter
asks you the following questions. Craft a response that you would feel comfortable giving
for each one.
• Describe an experience in the workplace when your attitudes and beliefs were
ethically challenged? Use a personal example if you have not experienced a
workplace dilemma.
• What are the most important values that would drive your behavior as a new staff
accountant in a CPA firm?
• Describe your ethical expectations of the culture in an accounting firm?
• What would you do if your position on an accounting issue differs from that of firm
management?
Selected points:
• I, as many students and recent grads, have been challenged ethically in being asked by a
friend to share homework, tell what was on a test, or covering up who did what on a
group project in order to get the best grade. These are conflicts of loyalty to a friend
versus having integrity, and a short-term payoff versus long-term habits. I have tried to
choose having the long-term habit of integrity and honesty.
• While some compromises are required in a workplace setting, an employee should