Ethical vs Unethical in Financial Management

 What is ethics?

Ethics, also called moral philosophy, the discipline concerned with what is morally good and bad and morally right and wrong. The term is also applied to any system or theory of moral values or principles.

                                                                         or                                           

That branch of philosophy dealing with values relating to human conduct, with respect to the rightness and wrongness of certain actions and to the goodness and badness of the motives and ends of such actions.

Financial Management:

Financial management means planning,organizing, directing and Controlling the financial activities such as procurement and utilization of funds of the enterprise. it means applying general management principles to the financial resources of the enterprise.

Ethical Issues:

• Act with honesty and integrity.
• Avoid conflicts of interest in professional relationships. Also, avoid the appearance of such conflicts.
• Provide people with accurate, objective, understandable information. Disclose all relevant information, positive and negative, so that your listeners have an accurate picture.
• Comply with all rules and regulations governing your position and your company.
• Act with good faith and independent judgment. Don't allow self-interest or other factors to sway your recommendations.
• Never share confidential information or use it for personal gain.
• Maintain an internal controls system to guard against unethical behavior.
• Report anyone you see violating the code. 

Unethical issues :

• Deliberate abnormal delays in payments to (a) Vendors, (b) Dealers commissions and promotion costs.
• Delays in paying wages, interest to financiers, incentive, bonus to employees.
• Holding up bills of vendors on silly reasons and ultimately buying from others to avoid payment to earlier vendors.
• Not prompt in statutory payments of ESI, PF, Sales Tax and Excise Duties.
• heating employees of their dues towards medical expenses, leave travel assistance, children education fees etc.
• Opening of current accounts in different banks to avoid adjustments against loans by earlier banker.
• Creating bogus bills of purchase to show higher costs and hence losses to avoid bonus payment to employees.
• Collecting loans from private financiers at higher rate of interest to help kith and kin and to get kick-backs.
• Quick release of payments to known or adjustment parties and delaying payment to others.