Bribery

Definition

Bribery is the act of offering, giving, receiving, or soliciting something of value to influence the actions of an official or other person in a position of authority. In managerial accounting, bribery is considered a severe ethical violation that can distort financial reporting and decision-making.

5 Must Know Facts For Your Next Test

1. Bribery undermines trust in financial reports and managerial decisions.
2. It is explicitly prohibited by the Institute of Management Accountants (IMA) Statement of Ethical Professional Practice.
3. Engaging in bribery can lead to severe legal consequences for both individuals and organizations.
4. The IMA requires management accountants to uphold principles like integrity and transparency to prevent bribery.
5. Internal controls and auditing procedures are designed to detect and prevent bribery within organizations.

Review Questions

• Why is bribery considered an ethical violation in managerial accounting?
• What are some potential consequences for an organization found guilty of engaging in bribery?
• How does the IMA Statement of Ethical Professional Practice address bribery?

Related terms

Ethical Standards: Principles that guide professional behavior, ensuring actions meet societal norms and organizational values.

Fraud: Deceptive practices intended to secure unfair or unlawful financial gain.

Internal Controls: Processes and procedures implemented by an organization to ensure the integrity of financial and accounting information, promote accountability, and prevent fraud.