ETHICAL CONSIDERATIONS RELATED TO IT GOVERNANCE (STUDY OBJECTIVE 9)

ETHICAL CONSIDERATIONS FOR MANAGEMENT

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The management of any organization has an ethical obligation to maintain a set of processes and procedures that assure accurate and complete records and protection of assets. This obligation arises because management has a stewardship obligation to those who provide funds or invest in the company. Stewardship is the careful and responsible oversight and use by management of the assets entrusted to management. This requires that management maintain systems that allow it to demonstrate that it has appropriately used these funds and assets. Investors, lenders, and funding agencies must be able to examine reports that show the appropriate use of funds or assets provided to management. This is accomplished by the maintenance of accurate and complete accounting records and accounting reports with full disclosure within those reports. Therefore, management should have a mechanism that assists the organization in the development of accurate and complete accounting processes and systems.

In many cases, poorly designed IT systems can allow a fraudster to perpetrate fraud. In the case of the Phar-Mor drugstore chain fraud, a vice president became concerned about the adequacy of the IT system and the resulting reports. This vice president formed a committee to address the problems, but ...

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