Marsha Ethical Issues

It is unethical for Jack to ask Dave to withhold the ABC costing information from Marsha. To do so, doesn’t empower Marsha to make the most informed decision regarding outsourcing of the gift boxes. Activity-based costing details relevant costs more accurately than a traditional costing system (Hilton &Platt, 2017). It is advantageous to the International Chocolate Company that Dave has performed some ABC studies. Dave does a great job of referencing his ethical duty to his profession to provide Marsha all of the information, including the ABC studies. Giving Jack the studies fist, would be unethical as this hasn’t been authorized, according the Institute of Management Accountants, Inc. Statement of ethical professional practice (Hilton & Platt,

2017).

Resolving the unethical issues in this case, require that Dave move forward with sharing the ABC study information with Marsha. Acting unethically would call into question Dave’s competence, integrity and credibility (Hilton & Platt, 2017). To avoid this, Dave should schedule the meeting he suggests, with both Marsha and Jack, where the data can be reviewed and the morale, quality, and reliability of outsourcing can be openly discussed. While, outsourcing can put strain on employment relationships, these challenges can be worked through with effective transitions led by line managers (Mitchell & James, 2017). In this case the benefit of the cost savings may outweigh the challenges of outsourcing the gift box with good leadership through the transition, however, to decide Marsha must have all the information from the ABC study.

References
Hilton, R.W. and Platt, D.E. (2017). Managerial Accounting: Creating Value in a Dynamic Business Environment (11th ed.). New York, NY: McGraw-Hill Education. ISBN 9781259569562

Mitchell, I., & James, P. (2017). Outsourcing transitions and the employment relationship implications. Human Resource Management Journal, 27(4), 614-629. doi:10.1111/1748-8583.12146