CIMAPRO19-P03-1 Exam - Topic 2 Question 63 Discussion

Actual exam question for CIMA's CIMAPRO19-P03-1 exam

Question #: 63
Topic #: 2

You are a member of the Chartered Institute of Management Accountants (CIMA) and you have recently taken up the position of Sales Manager with a company that is facing financial difficulties.The company's termsinclude a commitment to maintainspecifiedprofitability, liquidity and solvency measures; failure to dosowould renderbankloans immediately repayable. The draft financial statements show that the company has not succeeded in complying with all of these requirements.

The financial results are very dependent on various estimates such as receivables impairments.The Chief Executive Officer (CEO) has suggested that these be recalculated so as tobring the financial results within the requirements of the bank. He has asked you to sign pre-dated internal documentation which would imply that, asSales Manager,you initiated these changes in the belief that they would enhance the accuracy of the Financial Statements.

WhichTWOof the following courses of action available to you would be ethically acceptable according to the CIMA Code of Ethics?

ARefuse to sign the documentation on the grounds that you did not initiate this action, and to give the impression that you did would be unethical.

BAgree to sign the documentation on the grounds that these matters are highly subjective anyway and the proposed changes are, at least, plausible.

CRefuse to actually sign the documentation but make clear to the CEO that youwill raise no objection if he amends the Financial Statements asif you had signed.

DSeek legal advice on the matter because you feel you are being placed in a very difficult position.

Show Suggested Answer

Suggested Answer: B, C, E

by Lavera at Mar 19, 2024, 04:50 PM

Limited Time Offer

25%

Off

Get Premium CIMAPRO19-P03-1 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Benedict

4 months ago

I can't believe the CEO would even suggest that!

upvoted 0 times

...

Flo

5 months ago

D is a smart move, always better to get legal advice.

upvoted 0 times

...

Alaine

5 months ago

B seems a bit too risky, right?

upvoted 0 times

...

Jean

5 months ago

I agree, A is the only right choice here.

upvoted 0 times

...

Brandon

5 months ago

Definitely A. Signing that would be super unethical.

upvoted 0 times

...

Samira

6 months ago

I recall that the CIMA Code emphasizes transparency. I think option A is definitely the most ethical, but I’m unsure if I’d have the courage to stand up to the CEO in real life.

upvoted 0 times

...

Sabina

6 months ago

I’m torn between A and D. I know signing something I didn’t initiate is unethical, but I also feel like getting legal advice could help clarify my position.

upvoted 0 times

...

Flo

6 months ago

This scenario feels familiar; I think we practiced something similar in our case studies. I’m leaning towards option A, but I’m not entirely sure if seeking legal advice might be a safer route.

upvoted 0 times

...

Theola

6 months ago

I remember discussing the importance of integrity in our ethics classes. Refusing to sign seems like the right choice, but I worry about the potential backlash from the CEO.

upvoted 0 times

...

Queenie

6 months ago

Refusing to sign and seeking legal advice seems like the safest approach. I don't want to risk my professional reputation by going along with this.

upvoted 0 times

...

Ahmed

6 months ago

I'm a bit confused about the options here. I'll need to think through the implications of each one to decide what's best.

upvoted 0 times

...

Chau

6 months ago

Signing the documentation would be wrong, even if the CEO says the changes are plausible. I don't want to be complicit in misleading the financial statements.

upvoted 0 times

...

Brinda

6 months ago

This is a tricky situation. I'll need to carefully review the CIMA Code of Ethics to determine the most ethical course of action.

upvoted 0 times

...

Phuong

6 months ago

Civil war and weakening of infrastructure? That doesn't seem right. I'll go with the options that seem more directly related to the effects of money laundering.

upvoted 0 times

...

Ena

6 months ago

I remember something about zones reducing the need for multiple SQL databases, which sounds like a big advantage.

upvoted 0 times

...

Lashon

7 months ago

This looks like a tricky question. I'll need to think through the different options carefully.

upvoted 0 times

...

Ty

11 months ago

I see the CEO's trying to pull a good old 'creative accounting' trick here. Quick, someone get the Enron team on the line - they're the experts in this kind of financial gymnastics!

upvoted 0 times

...

Kelvin

11 months ago

Nope, nope, nope. I ain't putting my name on anything that's not 100% legit. I'd rather take a stand and risk the wrath of the CEO than compromise my integrity. Where's the 'Grow a spine' option on this question?

upvoted 0 times

Kasandra

10 months ago

D) Seek legal advice on the matter because you feel you are being placed in a very difficult position.

upvoted 0 times

...

Avery

10 months ago

A) Refuse to sign the documentation on the grounds that you did not initiate this action, and to give the impression that you did would be unethical.

upvoted 0 times

...

Moon

11 months ago

Well, if the changes are at least plausible, maybe it's not the end of the world. But I don't know, man, it still feels kinda shady. I'd probably just keep my head down and let the CEO handle it.

upvoted 0 times

Kerry

10 months ago

C) Refuse to actually sign the documentation but make clear to the CEO that you will raise no objection if he amends the Financial Statements as if you had signed.

upvoted 0 times

...

Dottie

10 months ago

B) Agree to sign the documentation on the grounds that these matters are highly subjective anyway and the proposed changes are, at least, plausible.

upvoted 0 times

...

Norah

10 months ago

A) Refuse to sign the documentation on the grounds that you did not initiate this action, and to give the impression that you did would be unethical.

upvoted 0 times

...

Tamala

11 months ago

Hmm, I see the CEO's point about wanting to meet the bank's requirements, but signing false documentation is a big no-no. I think seeking legal advice is the way to go - gotta cover my own behind here.

upvoted 0 times

Bette

10 months ago

Seek legal advice on the matter because you feel you are being placed in a very difficult position.

upvoted 0 times

...

Rickie

10 months ago

Seek legal advice on the matter because you feel you are being placed in a very difficult position.

upvoted 0 times

...

Alex

11 months ago

Refuse to sign the documentation on the grounds that you did not initiate this action, and to give the impression that you did would be unethical.

upvoted 0 times

...

Mozelle

11 months ago

Refuse to sign the documentation on the grounds that you did not initiate this action, and to give the impression that you did would be unethical.

upvoted 0 times

...

Marguerita

12 months ago

I'm not comfortable signing those pre-dated documents. That would be misleading and goes against the CIMA Code of Ethics. I'd rather stand my ground and refuse to participate in this dubious activity.

upvoted 0 times