What are the ethical issues facing jason

Assignment Help Managerial Accounting

Reference no: EM133588125

Case

Fiora Ltd is a manufacturer of paint, is listed on the ASX and has a 20 year history of successful operating results. Jason Torney is an accountant on his probationary year, who started working at Fiora around a year ago. Jason has been tasked with helping Craig, the financial officer of Fiora, with preparing the financial statements for the year ended June 30 2023.

As part of his work in preparing the financial statements, Jason noted that Fiora had another successful year, exceeding their targeted profit. Part of this result was achieved by bringing forward the launch of a new type of paint, codenamed LMD12, which was developed by the research and development (R&D) team at Fiora at a cost of $5 million and launched with a $2 million promotional campaign. The unique chemical composition of LMD12 means that the paint has a faster drying time, and superior levels of UV resistance when compared to other paints on sale in the same segment of the paint market. Sales of LMD12 for the year ended 2023 were $12.5 million.

As part of his enquiries with the R&D manager of Firoa, Jason learned that Fiora 'cut some corners' in preparation for the launch of LMD12, and the scientific verification of the new product's compliance with legislative requirements was not completed in full. The R&D manager was worried that the chemical formulation of the paint may contain levels of toxins which exceed the legal mandatory safety requirements.

Jason mentions this conversation to Craig, who was quite dismissive of the issue. Craig responded by saying, 'The sales team have me given no evidence whatsoever that there is any problem, and I doubt there will be any problems before Firoa's results are released to the ASX and made public'. Craig then warned Jason not to mention any of this to the auditors. Jason was concerned by Craig's comments.

Required:

a) What are the ethical issues facing Jason?

b) Advise Jason of appropriate courses of action from the teleological ethical perspectives of 'ethical egoism' and 'utilitarianism'. Justify why these are based on 'ethical egoism' and 'utilitarianism'.

c) Recommend a course of action for Jason based on deontological theory. Outline why this course of action is based on deontological ethics.

d) Which ethical theory do you think leads to the most appropriate course of action for Jason? Justify your position.

Reference no: EM133588125

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