Exam 1

Question 1

Normative ethics

Answer 1

Acting based on expected behaviors from society

Question 2

Behavioural ethics

Answer 2

How to act in situations or pressures

Question 3

4 ethical dilemmas

Answer 3

Truth vs loyalty
Justice vs mercy
Short term vs long term
Individual vs community

Question 4

Moral motivation

Answer 4

Being able to internalise where codes of conduct come from

Question 5

Moral character

Answer 5

Capacity to do what is necessary even when unpopular

Action, follow through

Question 6

Fraud triangle weights from KPMG

Answer 6

Opportunity- 59%
Motive- 21%
Rationalisation- 11%

Question 7

Moral justification

Answer 7

Lack of moral sensitivity

I lied to protect the company

Question 8

Euphemistic labelling

Answer 8

I borrowed it instead of I stole it

Trivialising the act

Question 9

Displacing responsibility

Answer 9

Putting responsibility on a specific person

I was just following orders.

Question 10

Diffusing responsibility

Answer 10

Everyone else is doing it

Question 11

Ethical fading

Answer 11

When someone doesn’t realise the decision they make has ethical implications

Question 12

Miscalibration

Answer 12

Overconfidence in abilities to understand and handle issues

Question 13

Miscalculation

Answer 13

Overestimating the extent to which you would engage in good behaviours

Question 14

Motivated blindness

Answer 14

Overlooking unethical behaviour because it is in our best interest to ignore it.
Conflict of interest

Question 15

Indirect blindness

Answer 15

Blaming a third party

Question 16

Overvaluing outcomes

Answer 16

Ignoring process behind outcome
Knowledge is the most important thing
Ends justify the means

Question 17

Ethical leadership

Answer 17

Bringing together communication, upholding rules, and focuses on stakeholders

Question 18

Formal systems

Answer 18

Selection systems
Policies
Orientation
Performance management
Decision process

Question 19

Informal systems

Answer 19

Norms
Rituals
Myths
Language

Question 20

Altruistic cheating

Answer 20

Cheating to help someone else out, being loyal

Question 21

Going south fraud motivations

Answer 21

Discounting
Familiarity
Escalation

Question 22

Accounting openings for bias

Structural-mental

Answer 22

Ambiguity- discounting
Attachment- familiarity
Approval- easier than asking questions, escalation

Question 23

World Com motivations

Answer 23

Industry was in decline due to dot com
Focused on expense:revenue to be #1 on Wall Street
Telecom Act- could not longer acquire cell phone companies

Question 24

World com ethical breakdowns

Answer 24

Indirect blindness
Discounting bias
Overvaluing outcome
Slippery slope

Question 25

Rest 4 models of ethical behaviour

Answer 25

Moral sensitivity
Moral judgement
Moral motivation
Moral character

Question 26

Ethical breakdowns

Answer 26

I’ll conceived goals
Motivated blindness
Indirect blindness
Slippery slope 
Overvaluing outcomes

Question 27

Ethics vs morals

Answer 27

Ethics are operational, applied, actions

Morals are internal

Question 28

Diann’s fraud schemes

Answer 28

Expense reimbursements
Altering salary
Duplicating checks
Creating dummy vendors

Question 29

Focusing failures

Answer 29

Ethical fading
Miscalibration
Miscalculation

Question 30

Milgram experiment rationalisations

Answer 30

Just doing what they’re told
The victim wasn’t in that much pain
Victim could have gotten out of straps
Denial of the victim
Slippery slope (more and more volts)
Influenced most by someone else being experimented on in the room

Question 31

3 types of bias affiliations

Answer 31

Employment
Alma mater
Chance

Question 32

WorldCom contributing factors of fraud

Answer 32

Leadership and culture- company goals
Internal controls- CFOs general ledger access
Internal audit- reporting channels
External audit-auditor client relationships
Board of directors

Question 33

Moral sensitivity

Answer 33

Being able to sense that something is wrong, helps prevent ethical fading

Question 34

Ethical dilemma

Answer 34

A situation with two outcomes, both of which can be right

Question 35

Corporate culture iceberg

Answer 35

Code of conduct/ethics are what we can see, top of the iceberg
Norms and culture are below the iceberg

Question 36

I’ll conceived goals

Answer 36

Creating goals and incentives to motivate those around us but with unintended consequences

Question 37

Rationalizations

Answer 37

Moral justification 
Advantageous comparison
Euphemistic labelling
Minimising the act
Denial of the victim 
Displacing responsibility
Diffusing responsibility
Entitlement