ICAEW BIP · Chapter 10 · Question 10 of 10
The managing director of a company asks the management accountant to reduce the forecast costs in a cash flow forecast that will be given to the bank to support a loan application, although the accountant believes the original forecast is realistic. Which fundamental principle of the ICAEW Code of Ethics is most directly threatened?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Integrity
Explanation
Integrity requires a professional accountant to be straightforward and honest and not to be knowingly associated with information that is false or misleading. Reducing costs the accountant believes are realistic would make the forecast misleading. The pressure from the managing director is an intimidation threat to this principle.
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