Ethics Analysis

Ethics Analysis

This paper examines how ethics impacts the decision making process, using the article "Keep your books lean". Ethical decision making provides a framework for dealing with complex issues. An ethical dilemma implies that there may be some question about more than one course of action with differing outcomes or consequences for oneself or a client. Ethical dilemmas may emerge where there is concern for the client's well being or a conflict of interest in which there is a question of the appropriateness of an action and whether such action is in the client's best interest (Hamm, 2002).

If customers, investors, co-workers, and creditors all constantly lied effective communication and economic activity would be impossible. The information would have no credibility. Fortunately, most individual in ethics are ethical. The actions of these individual are both responsible and legal and most of all they consider the organizations interest in their decision making. The article discusses two different types of accounting, generally accepted accounting principles (GAAP) and management accounting and the organizations whom use them manufacturing and distribution companies, why they are so different (Engle, 2005).

Management's responsibility is to provide an acceptable return to the company's stakeholders. GAAP identifies inventory as an asset composed of material, labor and overhead. Inventory is valued at a standard cost, standards will vary with volume. Higher volume unites produce lower unit costs and favorable production. Financial reporting rewards plant managers when production costs are lower thank standard, in these types of situations is where ethics come into place, some managers may want to change the numbers to their benefits. The financial management objectives of the organization are having exceeding volumes to generate inventory (Engle, 2005).

However, financial