Test: What's your ethical approach?

Imagine that you have gone into a small neighbourhood store to buy a drink and a newspaper. When you get your change the shopkeeper is distracted by an elderly customer who needs assistance. As you leave the store you realise that you have been given a £20 note instead of the £10 change due.

What would you do?

Assuming that you returned the note, which of the statements below would be a valid reason to hand it back?



It is wrong not to return someone else's property


It would not be fair to the shop assistant / owner


You might get found out and challenged

All would be valid reasons

As a management accountant you may need to consider what influences you to make a decision. Would it be because you know it's just not the right thing to do? Or is it because a decision could have a negative effect on the shopkeeper or assistant? What do the rules say - might you be caught out? Using your analysis beyond the rules is often important as a management accountant - understanding impact and longer term effects.

We often use a combination of reasoning to help guide decisions. These could be described as moral philosophies (Roger Steare, Ethicability, 2006):

(A) Our PRINCIPLED CONSCIENCE - we do the right thing because it is fair. Our inner sense of right and wrong and the values that guide us most of the time

(B) Our SOCIAL CONSCIENCE - we decide what is right by considering the consequences on others. In a work situation this could impact on how our actions will affect others. Those involved in our lives and our work and the wider community (be they staff, customers, shareholders, etc)

(C) Our RULES CONSCIENCE - we do not need to think because rules tell us what is right and wrong. Regulations are necessary but they cannot be relied upon in isolation, as it may result in us giving up our sense of personal and social responsibility and judgement. That is why the CIMA Code is principles based.

However, you may have decided not to return the money. But then ask yourself how you would feel if you made an honest mistake and that happened to you.

Ask yourself what you would do if a customer by accident had double paid an invoice into your company's bank account.

This may have been a mistake. However, if you don't inform them and try to make good (either by crediting their account or returning it) under UK law, for example, there is potential for this to be seen as theft.

Keeping any money wrongly credited to your account, could lead to you being charged with ‘Retaining wrongful credit’. The 1968 Theft act defines this as: "A person is guilty of theft if he dishonestly appropriates property belonging to another with the intention of permanently depriving the other of it".

Dishonestly retaining a wrongful credit

A person is guilty of an offence if*

(a) wrongful credit has been made to an account kept by him or in respect of which he has any right or interest;

(b) he knows or believes that the credit is wrongful; and

(c) he dishonestly fails to take such steps as are reasonable in the circumstances to secure that the credit is cancelled.

However, beyond the rule that is in place here consider how your customer would view you if they sometime later discovered this and you hadn't informed them or tried to make good? And how other customers would view this if it were to become public? There would be a breach of trust in the company and reputational damage. So it is worth considering the wider impact and why sometimes ethical behaviour may be judged beyond the law.

As a professional accountant you have a commitment to act with integrity and to apply fair dealing and truthfulness.




You can now review other resources and support that further explains the importance of ethics in business and the finance function in particular. View Resources ›

This tool is produced to assist students’ understanding of professional ethics in exams and in their working lives. The Student Ethics Support Tool is not a substitute for CIMA study texts, but a support to your studies.