Understanding the Key Facts of the Situation
In the complex scenario involving Elizabeth City Medical Supplies (ECMS) and its new Controller, Jackson Jones, we encounter a multifaceted ethical dilemma deeply rooted in the principles of accounting ethics. This dilemma was shaped by a competitor’s purchase by ECMS, funded by an enormous loan. Jackson, in charge of the new acquisition’ disorganized records, immediately recognized the financial records disarray. With the company juggling to manage an erosion of sales and financial strain, it gradually forged its way back with lucrative Medicare sales in the nursing home industry. However, the positive development was overshadowed by the reluctance of President Bill Bailey of the company to inform those profits to the bank, which took Jackson on a severe ethical skew.
Jackson’s Ethical Dilemma: A Personal Conflict
The issue of Jackson transcends professional obligations and turns personal integrity and moral responsibility. With his role as the Controller of ECMS, it becomes his responsibility to ensure that accurate financial records are kept, which form a basis for building trust and dependability in business. Yet, the liability contradicts Bill Bailey’s order, the president of the company who said that all the financial data must be underestimated. The opposition is not just a contradiction based on professional ethics but contradicts the indicative values and principles of Jackson.
Identifying the Stakeholders Affected
Adding to this dilemma is a broad array of stakeholders with very high interests at stake. For instance, customers in nursing homes rely upon ECMS to continue operations and meet crucial safety requirements from supplies (Shi et al., 2021). In addition, the financial dealing of ECMS has a direct and indirect implication for Medicare and, hence, subsequent taxpayers, thereby making the total imports astronomical.
Exploring Jackson’s Possible Choices
In deciding on this ethical dilemma, Jackson has several alternatives on a spectrum, with each choice having its consequences and moral concerns. The easiest thing to do would be to fully disclose the actual financial state of affairs to the bank. Such an approach would be in keeping with the highest tenets of ethics, requiring that transparency and honesty feature in financial reporting. However, this path is fraught with potential immediate economic fallout for ECMS, possibly impacting its relationship with the bank and, in turn, its creditworthiness.
On this spectrum lay at the far end of this option the possibility of heeding Bill’s directive to under-report on the financials. In contrast, it may offer some temporary relief towards that review of the bank and potentially not create an immediate financial distress situation for John. Nonetheless, these carry a lot of risks. Such an action will not only be against ethical norms but at the same time is also likely to expose Jackson and the company to long-term legal ramifications along with losing colossal credibility.
Recommended Course of Action and Justification
After easing facts with stakeholders and the outcome of not revealing such information, the following recommendation for Jackson is straightforward. He should promote full disclosure regarding the financial position to the bank. Although it was a difficult decision in the short term, it is more commensurate with ethical standards within the accounting profession. It supports maintaining trust over the long haul. It makes it an assurance to protect the integrity of the profession and the interests of all the entities, including the bank, the ECMS employees, and the public. This action not only settles the immediate ethical predicament for this accounting area but also sets a benchmark for more up-standing ethical behavior despite financial adversity where trust and accuracy come first and foremost.
Reference
Shi, J., Hua, W., Tang, D., Xu, K., & Xu, Q. (2021). A study on supply–demand satisfaction of community-based senior care combined with the psychological perception of the elderly. Healthcare, 9(6), 643. Web.