Certified Management Accountant Professional Ethics 2 — Questions and Answers
Question 1: Under the IMA Statement of Ethical Professional Practice, which principle requires CMAs to avoid actual or apparent conflicts of interest?
- Competence
- Confidentiality
- Integrity (Correct answer)
- Credibility
Correct answer: Integrity
The Integrity principle requires members to avoid conflicts of interest and to refuse gifts or favors that could influence their actions.
Question 2: A CMA discovers that her supervisor has directed her to record a transaction in a way that inflates earnings. What is the FIRST step she should take?
- Report immediately to the SEC
- Discuss the issue with her immediate supervisor (Correct answer)
- Resign from the company
- Follow the supervisor's directive to avoid conflict
Correct answer: Discuss the issue with her immediate supervisor
The IMA's conflict resolution process begins by raising the issue with the immediate supervisor before escalating further.
Question 3: Which of the following BEST describes the confidentiality obligation of a CMA?
- Never disclose any information about the employer
- Disclose confidential information only when legally obligated or with proper authorization (Correct answer)
- Share internal financial data with industry peers for benchmarking
- Confidentiality applies only to publicly traded companies
Correct answer: Disclose confidential information only when legally obligated or with proper authorization
CMAs must refrain from disclosing confidential information unless legally required or authorized by appropriate management.
Question 4: A CMA accepts a consulting contract with a supplier to his employer without disclosure. This MOST likely violates which IMA ethical standard?
- Competence — failing to maintain professional skills
- Credibility — misrepresenting facts
- Integrity — having an undisclosed conflict of interest (Correct answer)
- Confidentiality — sharing proprietary data
Correct answer: Integrity — having an undisclosed conflict of interest
Integrity requires CMAs to disclose all actual or apparent conflicts of interest, including outside employment relationships with suppliers.
Question 5: The Credibility standard of the IMA Statement of Ethical Professional Practice requires CMAs to:
- Pass the CMA exam within two years of membership
- Communicate information fairly and objectively and disclose all relevant information (Correct answer)
- Maintain at least 30 hours of CPE annually
- Avoid working for competitors
Correct answer: Communicate information fairly and objectively and disclose all relevant information
Credibility obligates CMAs to communicate information fairly and objectively and to disclose all relevant information that could reasonably influence an intended user's understanding.
Question 6: When a CMA faces an ethical conflict that cannot be resolved internally after escalating to the audit committee, the IMA recommends:
- Immediately file a whistleblower complaint with the SEC
- Consult an attorney about legal obligations and resign if necessary (Correct answer)
- Comply with management's directive and document disagreement in writing
- Contact a competitor to expose the misconduct
Correct answer: Consult an attorney about legal obligations and resign if necessary
If internal resolution fails, the IMA advises consulting legal counsel about obligations and rights, and resignation may ultimately be necessary.
Question 7: Which scenario represents a violation of the Competence standard under the IMA Statement of Ethical Professional Practice?
- A CMA fails to update technical skills needed for a new accounting software implementation (Correct answer)
- A CMA discloses a supplier relationship to her manager
- A CMA reports a colleague's fraud to the audit committee
- A CMA refuses a gift from a vendor
Correct answer: A CMA fails to update technical skills needed for a new accounting software implementation
Competence requires CMAs to maintain and develop their professional knowledge and skills; failing to update skills for required tasks violates this standard.
Certified Management Accountant Professional Ethics 2
Under the IMA Statement of Ethical Professional Practice, which principle requires CMAs to avoid actual or apparent conflicts of interest?