Quiz: Are you ready to handle ethical dilemmas?

Do you ever experience that nagging feeling at work when something doesn’t feel quite right?

Most ethical dilemmas start with that sensation. Perhaps a client made a request that’s left you feeling uneasy, or you might get the feeling that they’re keeping something from you.

If you’re faced with a challenging ethical situation, start with a few simple questions.

Ask yourself: Why doesn’t it seem right? What fundamental ethical principles could be compromised (or under threat)? What interests of mine are impacting my perspective of the situation?

These questions help you to focus on a way to address the ethical dilemma.

Many ethical dilemmas in accounting practice stem from either the expectation of loyalty or the need to balance the direct and close relationship between an accountant and their client with a clinical view of their accounts.

One of the most effective ways to support accountants to respond well to ethical dilemmas is to cultivate an ethical culture, which includes transparency.

People should be encouraged to speak up and consult someone else if they have an ethical quandary. A culture of transparency helps accountants to do the right thing and safeguard the interests of the organisation.

This helps to remedy situations at the earliest opportunity so that they don't become unmanageable.

Brush up on your ethics knowledge by consulting IFAs range of resources on its ethics page.

Dealing with ethical dilemmas

The Consultative Committee of Accountancy Bodies (CCAB) aims to empower accountants with the required skills and knowledge to guide ethical decision-making.

Its published case studies cover various ethical questions, scenarios and dilemmas, and explore the sorts of questions that people might ask themselves to arrive at a decision.

The CCAB resource supports the Code of Ethics that professional accountants (i.e. members of IFAC member bodies including the IFA) are required to follow. There are five fundamental principles that form part of the Code’s conceptual framework for addressing ethical dilemmas, along with five types of threat that could undermine those principles.

The five ethical principles and threats are widely accepted and understandable. For example, a threat could be intimidation – the client might be very influential and the accountant may feel threatened if they don’t completely support their client. An advocacy threat refers to an accountant who promotes their client’s interests to such an extent that their objectivity becomes impaired.

Take the quiz

Organisations need to go beyond compliance and cultivate a culture that prioritises doing the right thing. This requires them to put proactive strategies in place, so that when ethical issues do arise, accountants are equipped to deal with them.

To help you gauge your level of readiness to handle ethical quandaries, Financial Accountant has created a 7-question quiz.