Running Head: BUSINESS AND ETHICS 1

Business and Ethics

Name

Course

Tutor

Date
BUSINESS AND ETHICS 2

Question 1

Business relies on the paperwork in determining what is to be achieved based on what

is or has been completed. During every financial year, a company has to ensure that all the

finances are in place through the use of a balance sheet. The auditor will have to know when

funds are missing or when some funds have been mysteriously used in areas that they were

not supposed to apply. Using these alongside the responsibility of an auditor, the only way

the company engaged in the fraud for so long without being noticed is when the auditors were

also in the scam to cover up the losses. Through proper accounting procedures performed

every financial year, a company should be able to determine any mission questions.

Question 2

Based on the idea of tobashi whereby companies are allowed to hide or mask losses

temporarily and pay them later, the auditors might have thought the fraud would be covered

after selling off the bad assets to other companies than buying them later when the company

is back on its feet. Also, they might have bought the idea that the acquisitions made by the

company would cover the fraud. The spending as they might have anticipated, if it all went

through, could be useful in covering the losses and paying up for the damages. In any case,

the company had concealed the loses to the eyes of the auditors to the point of such not

appearing in the balance sheet, it may have prevented them from detecting or acting

accordingly.

Question 3

Olympus culture is faced with various issues relating to its governance. Poor

governance in the organization resulted in fraudulent acts, an issue that was not addressed for

a very long time. The management was not concerned about how much the company had

wasted in covering up the fraud that took place in the organization. There is poor
BUSINESS AND ETHICS 3

management accompanied by the corrupt board of governance who fired the CEO for

whistleblowing about the fraud once he detected the gap in the balance sheet. The fraudulent

activity even raised concerns from other businesses inquiring if that way the best way of

doing business.

Question 4

As a company’s CEO, it was important for Michael Woodford to perform an in-depth

financial analysis of the company once he noticed anything was amiss. As the company’s

leader with ensuring a smooth flow of finances, Michael had to ensure that everything was in

line and report anything that was suspicious, which included the fraud that he detected. It was

the right decision to publish the fraud because if it was left without being address, the

company could have incurred a significant amount of losses (Hashim et al., 2020).

Question 5

According to the provisions of Dodd-Frank, whistle-blowers who provide the SEC

with legit information about a federal regularity are protected. Since he was to be protected as

the whistle-blower by the SEC, he would provide information on the fraudulent actions of

Olympus to better the organization’s financial future and that of the State.
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References

Hashim, H. A., Salleh, Z., Shuhaimi, I., & Ismail, N. A. N. (2020). The risk of financial

fraud: a management perspective. Journal of Financial Crime.