5RQ - Horngren'S Financial And Managerial Accounting

Question

List the four IMA standards of ethical practice, and briefly describe each.

Step-by-Step Solution

Answer

The four IMA standards for ethical practice are competence, confidentiality, integrity, and credibility.

Definition of IMA standards

The standards are prepared and developed by the Institute of Management Accountants (IMA) that management accountants are expected to follow when facing ethical challenges.

Four IMA standards of ethical practice

The four IMA standards for ethical practice are as follows:

Competence: There should be an appropriate level of professional expertise, knowledge, and skills and should comply with relevant laws.

Confidentiality: There should be confidentiality in information except when disclosure is required.

Integrity: Should mitigate the actual conflicts of interest.

Credibility: The information should be communicated fairly and objectively.