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Budgeting ethics q – P1

Forums › Ask CIMA Tutor Forums › Ask CIMA P1 Tutor Forums › Budgeting ethics q – P1

  • This topic has 6 replies, 2 voices, and was last updated 5 years ago by Cath.
Viewing 7 posts - 1 through 7 (of 7 total)
  • Author
    Posts
  • April 11, 2020 at 1:30 pm #567202
    anonymous570
    Participant
    • Topics: 19
    • Replies: 36
    • ☆☆

    Hi,

    Question:
    https://app.box.com/s/ouqe4eipwk66wb10fb4eb0vstp3m2zuz

    C is the solution, but I’m not really getting my head around why exactly.

    I would say that option C actually *is* an impact of caused by unethical behaviour in the budgeting system because if the target is set too high up, then of course there’s less motivation for the budget holder to strive to achieve it, so then they’d not encourage staff as much as make a serious attempt in achieving it as they know it’s out of reach, so they could just encourage staff to ignore the unattainable budget targets… Thanks ?

    April 23, 2020 at 3:01 pm #569019
    Cath
    Participant
    • Topics: 0
    • Replies: 446
    • ☆☆☆

    Hi there – Im agreeing with you again… its not obvious why and it only feels correct because its the least impactful of the options.

    I suppose the thinking is that under unethical budget conditions, managers are likely to push staff hard to meet unachievable targets (or manipulate to achieve them) – rather than encourage them to ignore them – so if unethical budgeting represents ways to achieve high figures then this one doesnt fit.

    You could, (if you have time) – contact the publisher to ask for more info – they do get back to you if you look an email address in the book itself.

    April 26, 2020 at 9:17 am #569260
    anonymous570
    Participant
    • Topics: 19
    • Replies: 36
    • ☆☆

    Thanks for that 🙂

    April 26, 2020 at 9:27 am #569264
    anonymous570
    Participant
    • Topics: 19
    • Replies: 36
    • ☆☆

    What you said makes sense, and I agree that it is the least impactful.
    Thanks for the suggestion to contact publisher, I’ve just done that in case they can provide more insight, but I can imagine their explanation being along similar lines as yours. ?

    May 1, 2020 at 3:09 pm #569698
    Cath
    Participant
    • Topics: 0
    • Replies: 446
    • ☆☆☆

    Ok – great idea… yes I think my/ your understanding is likely the best we have… good on you for flagging it with the publisher though…

    May 1, 2020 at 3:58 pm #569704
    anonymous570
    Participant
    • Topics: 19
    • Replies: 36
    • ☆☆

    thanks

    May 1, 2020 at 4:22 pm #569710
    Cath
    Participant
    • Topics: 0
    • Replies: 446
    • ☆☆☆

    Ok.- just writing this to close the question.( my comment needs to go last!) 🙂

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Viewing 7 posts - 1 through 7 (of 7 total)
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