QUT Business School AYN458: Ethical Issues in Plummet Pty Ltd Report

This report analyzes the ethical issues faced by the Chief Financial Officer (CFO) of Plummet Pty Ltd, who is in an ethical dilemma regarding the company's financial practices. The analysis utilizes two key ethical theories: Utilitarianism, which assesses actions based on their impact on the majority, an...Read More

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Ethical Issues
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Introduction
The ethical issues in Plummet Pty ltd is analyzed in the below sections using different
ethical theories as the Chief Financial officer of the company is in an ethical dilemma and not
able to identify the right thing that he can do, so implementation of ethical theories would help
him in differentiating what is right and what is wrong. Ethical theories are helpful in highlighting
the questions that are overlooked or these theories help in the analyses of case in pure economic
terms (Smith, 2010). Ethical theories that are explained in the below section also helps in
identifying and defending the option that is best suitable for CFO in this ethical dilemma. But at
last, what to do and what not to do is depend on the person so a judgment will be given as per the
applicability and understanding of ethical theories.
Ethical theories
Ethical theories are important because it helps in setting up a strong foundation for all the
challenging situations related to ethics or wrong and right doing. Ethical issues in Plummet Pty
ltd are identified and on that basis two theories that are most relevant to these ethical issues are
explained and that are Utilitarianism and Virtue ethics. Utilitarianism is one of the most import
theory in ethical theories as it states that “an action through which most people get benefited is
considered as right or ethical action and if an action leads to bad outcome or affect most of the
people negatively than it is considered as an unethical action” (Barrow, 2015). In this case,
pleasure or benefit is measured in term of employees as if CFO disclose to local council about
the rates then it will resultant in penalty and the company is liable to pay amount in cash to local
authorities for 14years rate that will affect the job of current employees and lead to employee
layoff or job loss. This thing was not happened if the financial officer that was appointed earlier

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took the step at right time, it is not easy for an individual to stand for right thing but it is
important to stand to safeguard the interest of others and to protect the interest of stakeholders of
the company (Brooks & Dunn, 2018). Stakeholders of the company are affected by each and
every decision of the company and it is the responsibility of a company to take care of their
stakeholder’s interest by running the business in right direction (Henn, 2009). This decision will
negatively effect on all the stakeholders of the company. On other side, if chief financial officer
remains silent and follow the instructions of Harry then he violates the professional ethics and
his moral values are not allowing him to do so, in this case chief financial officer is in dilemma
whether to reveal the truth to local council or to remain silent and think for the tight cash position
of the company and about the employees.
Virtue ethics is considered as the normative ethical theories that emphasizes on virtues of
mind, sense of honesty and character of decision maker (Schwartz, 2016). Further virtues is
considered as the moral or individual characteristics that make him a god or bad person or
influences that helps the person to identify what is good and what is bad. Virtue ethics theory
mainly focus on the individual characteristics as the main aspect of ethical thinking rather than
focusing on the rules of ethics or rules on how individual should react in a particular situation
as deontology states this focus on person character on an individual (Bell, Dyck & Neubert,
2017). In this case, the company is not behaving responsibly and not following the professional
accounting standard to disclose its accounting statement in fair manner. Plummet Pty ltd is a
private organization and it’s the responsibility of Harry, CEO of the company to run his business
in the fair and ethical manner by considering all the aspects of ethics. From the perspective of
virtue ethics theory it is clearly analyzed that chief financial officer wants to open the flaws and
disclose all the misconduct to local community as his moral values not allow him to follow

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wrong practices in his profession. So as per virtue ethics he should disclose all the rates and
accrual aspect in balance sheet to local community and company should pay the penalty and
rates amount in cash as per the rules and laws.
Judgment
On the basis of ethical theories and the concept that are explained above by applying in
the case to solve the ethical dilemma it is analyzed that consequences of disclosing negatively
affect the stakeholders of the company but professional conduct and ethics states that wrong
doing will help to run a business for short run (Ebenstein, 2018). It is suggested that CFO should
disclose this issue in front of local community without the permission of CEO as the company
will face serious consequences in near future as this breach of law will be identified by the
authorities at any time so it’s better considering the virtue ethics theory CFO should do right
things that benefit the company for longer run as it is the duty of an organization to abide by all
the law and rules in the fair manner and follow it so that trust of all stakeholders can be
maintained in the company as “ethics in business are important aspect to be considered and it is
essential to take decisions in the business on the basis of moral values” as this decision will
affect the employees and cash position of the company and also affect the profitability ratio in
the industry but this affect can be recover by the company in next year but this accrual issue and
non-disclosure of full information is against the accounting profession.

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Conclusion
Ethical theories helps an individual to take the right decision by understanding all the
aspects of a situation and by understanding the impact decision in ethical and unethical manner
and “ethical dilemma is a situation in which person is confused between two choices neither of
which is acceptable according to ethical perspective”. By analyzing the case and by gaining the
knowledge of two ethical theories it is understood that ethics are important in business,
Utilitarianism theory focus on the impact or amount of good that happen to stakeholder with a
decision whereas virtue ethics theory emphasizes on the individual character or moral values has
greater impact on an individual decision maker. From the case analysis it is suggested that CFO
should disclose all the facts in balance sheet of the company in just and fair manner and all the
consequences that company will bear can be sorted out in a year. This will help the company to
maintain the interest of stakeholders and to run the business in fair manner for long run.

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References
Barrow, R. (2015). Utilitarianism: A contemporary statement. Routledge.
Bell, G. G., Dyck, B., & Neubert, M. J. (2017). Ethical Leadership, Virtue Theory, And Generic
Strategies. Radical Thoughts on Ethical Leadership, 113.
Brooks, L. J., & Dunn, P. (2018). Business & professional ethics. Cengage Learning.
Ebenstein, L. O. (2018). Routledge Revivals: The Greatest Happiness Principle (1986): An
Examination of Utilitarianism. Routledge.
Henn, S. K., 2009. Business ethics : A case study approach. US: John Wiley & Sons.
Schwartz, M. S. (2016). Ethical decision-making theory: An integrated approach. Journal of
Business Ethics, 139(4), 755-776.
Smith, J., 2010. Ethics and financial advice: The final frontier. Melbourne: Victoria University
and Argyle Lawyers Pty Ltd.