Run Inc. Ethics Case - Essay Example

Martin, concerned with these figures, wanted to go through the receivables files. But he felt resistance from the top level management in doing so. Some of the inventories were the result of sales that the company was expecting to happen and some were the sales those were shipped but not accounted in cost of sales. Thus they were hiding on their cost of sales and making the profit to look larger. One of the accounting decisions which Martin Field was supposed to take was to take care of the receivables and inventories.

Another was how to take care of the ‘borrowed profits ‘of the organization. For the first one Martin had options either to look for receivables file and go for a visit in warehouses or just sit back and let the things happen as he was told by the top management. But as a CPA he must not let loyalty to take precedence over honesty and integrity. So he should go to warehouses and have a look at the receivables file, even if it means going against the agencies i.e. the top level management. For the second one he had choices to go with the accounting procedures which he used to take care of the ‘borrowed profit ‘ or else he could go with the procedure suggested by John, i.e. to write off the whole amount by describing them under unusual items.

Martin should keep on his integrity and should go for the accounting procedure which he feels is ethically compatible and aligned in greater interest. If Martin would go to visit warehouses and look at the receivables file, he could have a better idea of the reason behind such a huge inventory and receivables levels. Such a course will definitely proved to be good for all the stakeholders in long run if not in short run. But if Martin would just sit back and let the things go on, it would be wrong in every perspective.

Company would suffer in long run. Investors, clients, suppliers, creditors all would suffer from information asymmetry. Regarding the