Ethical and unethical issues in finance Management

Finance management  

=> It refers to efficient and effective management of money in such manner as to      accomplish the objective of the organization. 

                                              Ethical Issues          

Some of the Ethical issues in finance are given below:-

*Financial statement

*Financial markets

*Insider trading

*Hostile takeovers

All above the finance ethical issues are mentioned below:-

1) Financial statement

=>  Preparing and maintaining precise and reliable financial statements is the essence of fair financial reporting. However, many companies are looking for ways to present their financial standing in a proper rather it’s actually.

2) Financial markets

=>  In this, barriers like unequal information, bargaining power and resources can be controlled within the parties. Markets needs clients and clients are earned through confidence.

3) Insider trading

=>  Insider trading is a huge issues among people. Many companies lose potential investor from insider trading because people who do not have information that is not yet into the public lose their confidence and trust towards the company.

4) Hostile takeovers

=>  It is acquiring a majority interest in the stock of the company on the open market. Another method like a bidder may initiate a hostile takeover through a tender offer which means a bidder proposes to purchase the target company’s stock at a fixed price above the current price.

                                                             Unethical Issues

Some of the unethical issues in finance are given below:-

*Thefts

*Frauds

*Corruption

All above the finance unethical issues are mentioned below:-

1) Thefts

=>  Companies bear big financial losses due to theft of raw materials, semi finished goods, finished goods ,supply ,scarf and raw materials. Often clerks like lower labour employee, security guards, drivers are also involved in this theft. Sometimes when goods are high monetary value then big officers are also involved in this theft.

2) Frauds

=>  It is deliberate misrepresentation which causes another persons to suffers damages , usually monetary losses.

3) Corruption

=>  It allocates resources and opportunities in that ways which are unfair and inefficient. Absences of accountability , social responsibility , lack of proper control is the main cause of corruption.