1) Assume your role as an accountant requires you to report to senior central management on the performance of your division. Unfortunately, results have not been as strong as expected, with profits lower than budgeted, although revenues are doing well. Your direct (divisional) manager has instructed you to focus on that the fact that revenues are up and try and hide the fact that profits are down.

Describe and explain the key ethical principles which professional accountants are expected to follow in general.

Discuss which of these principles seem most relevant to the decision faced by you in this example and state what you would do.

2) Explain with examples how a board of directors can best safeguard the interests of shareholders.