Financial literacy month takes place during the entire month of April. Several activities campaigns will take place this month in order to raise financial awareness, further people's money management skills, and encourage financial responsibility.
This month started in America partly due to findings in several studies that suggested that majority of students that graduated from high school lacked practical money management skills. In addition, many students were found unable to balance a checkbook, as well as having no insight on how to manage the spending, savings, earnings, and investments.
More specifically, the American Savings Education Council found less than half of the U.S. high school and college age population have a regular savings. Additionally, only a small fraction of students in that age range were found to keep a budget, while more than 1/3 of those did not keep track of their spending at all. There is absolutely no doubt that these statistics are very similar here in the Bahamas.
Financial literacy month raises awareness about the millions of young adults around the world that have a hard time when it comes to establishing credit and maintaining a positive credit history. Most have developed bad money management habits that started in high school and for many; those habits stay with them their entire life. Unfortunately they learn their money management lessons after a major financial mistake. Many young people have learned through personal experience due to a lack of financial awareness. These financial mistakes can completely be avoided if something is done early enough to teach our youth. My last article mentioned that this month has been officially been proclaimed as Financial Literacy for Youth Month in The Bahamas by our nation’s Prime Minister.
Some of the lessons youth will learn during this month is the importance of personal financial management, the rules of money and how it works, financial behavior of the wealthy, how to avoid bad financial mistakes and the smart steps toward the road to Freedom!
You can choose from a handful of different ways to help raise awareness about the financial education movement here in the country. Here’s how you can get involved.
1. StandUp for Financial Literacy campaign. This campaign involves a series of events across the country. The goal of this campaign is to get as many people to teach and talk about financial literacy to students.
2. Organize a Youth Money Game Night. Teenagers are always looking for ways to have fun. Why not teach them important financial lessons at the very same time. The T.E.E.N. (Teen Economic Empowerment Network) in conjunction with Creative Wealth is helping to host a series of money game nights all over the country. It takes a group of 5 or more teens together to host a game. You bring the youth, we bring the games.
3. If you have kids who are between the ages of 6- 12, enroll them into the “Rich Futures” Cashflow for Kids Club. Children are interested in learning about money at a young age. Educational psychologists say that between the ages of 5-12 children make decisions about life and how they plan to handle their future. They also make decisions about money. After the age of 12-14, it becomes harder for parents to teach them new ideas. It is best to teach them when they’re young and eager to learn. That is the purpose of the Rich Futures Cashflow for Kids club.
4. Host a “Teenz Talk Money” Session. There are many financial topics that our youth need to learn. It is important that they begin learning now. Some topics that can be discussed at these sessions are: an introduction to banking services, credit and credit cards, how to choose and keep a checking account, how to keep track of money, why you should save, save, save, paying for college and cars and what renting and home ownership is all about. It takes ten teens to host a session at a time and date convenient for the host. For a complete list of topics, feel free to contact me.
There are so many other things that you can do within your circle of influence. I would be happy to work with your kids, teens and young adults within churches, schools and communities to help to financially empower our next generation.
Youth financial literacy does not require that school systems undergo a complete overhaul within their educational systems, but rather they notice the need for a balance in education. Studies show that even as little as 10 hours of financial education makes a difference in the choices an individual makes with his or her finances.
Although the focus of financial literacy for youth month is the provision of money management training for our youth, this month is not just intended to focus solely on the youth. With many adults also lacking basic money management skills this campaign is intended to make everyone aware that picking up a practical financial education can improve many areas of their life.
It is my hope that financial literacy month inspires parents to engage their children in financial literacy education and that this message will extend into the classroom to touch the lives of those who will be the future leaders of this country. Let us use financial literacy month as a springboard to help your child and our youth learn how to become a financially responsible adults now before it’s too late.
If this is done, we can definitely expect a bright economic future for our nation.
Friday, April 16, 2010
Tuesday, April 13, 2010
e-Payment and the search for prudent management of public funds
Chairman, Federal Inland Revenue Service , Mrs. Ifueko Omogui-Okauru
One year after the introduction of e-Payment into the country, experts believe that the system needs to be fine tuned.
When the Federal Government mooted the idea of introducing the electronic-payment system in 2008, the decision was greeted by mixed reactions from experts in both the public and private sectors of the economy.
The system was officially introduced into the public sector in January 2009 to facilitate payment for goods and services, as well as minimise the level of interactions between contractors and government officials thus eliminating corrupt tendencies.
It was also meant to eliminate the use of cash to facilitate speedy payments of all transactions, fast-track the implementation of government policies through the elimination of delays in government’s payment system, enhanced real time reporting and improved quality of financial reporting system in the public sector, as well as elimination of risks associated with carrying large cash.
But one year after the flag off of the system, experts say a lot of improvement still needs to be done to enable the programme to achieve the desired objective.
The Federal Government was not unmindful of these facts when it organised a two day workshop on e-payment for Accountants-General and Auditors-General from the three tiers of government.
Speaking at the event, the Permanent Secretary, Ministry of Finance, Mr. Achi Achinuvu, admitted that there was still more work to be done to make the system achieve the desired result.
For instance, he said that as part of its ongoing reforms in the public sector, the Federal Government would from next year begin the implementation of an Integrated Financial Management Information System for the public sector.
The GIFMIS, which would be fully operational by 2011, would facilitate the end-to-end processing of the e-payment initiative.
The end-to-end e-payment initiative implies that all ministries, departments and agencies of government will be making e-payment directly to the beneficiaries from the infrastructure installed in their offices.
Already, the Office of the Accountant General of the Federation has been repositioned for the effective implementation of the system through the GIFMIS.
The move is coming on the heels of a series of complaints by contractors handling projects in remote areas over the difficulties associated with the e-payment model.
For instance, some contractors had in the past raised the alarm over information security, lack of regulatory framework, as well as infrastructural limitations associated with the payment mode.
But Achinuvu said that despite the bottlenecks associated with the mode of payment, the scheme had recorded huge success.
He said that the e-payment system, which was introduced a year ago, had helped to minimise the interaction between contractors and government officials thus eliminating corrupt tendencies.
To ensure an uninterrupted connectivity of the system, the Central Bank of Nigeria has been requested to champion the implementation of a national switch, which will serve as a platform to provide seamless interconnectivity for all banks.
He said that the workshop, with the theme, ”e-payment system and public financial management reporting system as tools for achieving transparency in government,” was coming at a time when the government budgeting process was undergoing phenomenal transformation.
He emphasised the need to kick-start the process, adding that the system would aid the computerisation of public financial management processes, from budget preparation and execution to accounting and reporting, with the help of an integrated system for financial management of line ministries, spending agencies and other public sector operations.
According to him, ”As the world moves in a direction of a global village, we cannot remain isolated within the mundane systems and practices of public sector accounting. We must keep pace with emerging trends in technological advancement.
”The present administration has continued to place emphasis on transparency, probity and accountability as a means of ensuring prudent and judicious utilisation of resources. While the commercial entities across the world are moving towards International Financial Reporting Standards, governments are harmonising with International Public Sector Accounting Standard. The Federal Government would be implementing the GIFMIS by next year.”
Speaking in the same vein, the Accountant-General of the Federation, Mr. Ibrahim Dankwaabo, urged the FG to approve the adoption of IPSAS as a form of reporting in the public sector.
”Adoption of a uniform global standard would ensure understandability of the financial statements on the part of international investors. In other words, adoption of IPSAS would increase the acceptability of accounts of Nigeria, internationally, ”he added.
But the Chairman of the Federal Inland Revenue Service, Mrs. Ifueko Omogui-Okauru said that sharp practices among Deposit Money Banks, as well as problems from switches in effecting transfers from one bank to another were major reasons why the Federal Government is yet to reaped the benefits of the e-payment system.
The FIRS boss, who spoke at the workshop, noted there was need to improve the system to enhance accountability and transparency
She said the diversion of some of the e-payment accounts, as well as the banks‘ inability to quickly reconcile the accounts when the need arose, were responsible for the complaints
According to her, ”Some of the problems we faced with e-payment at the FIRS, among others, have to do with reconciliation; being able to reconcile what is paid, what the banks received and ultimate basic account. The complaints and constraints facing accountants in FIRS are also the fact that e-payment has not been as fast as it should be.
”In fact, it‘s like we are doing the e-payment on the manual system; we have not seen the full benefits of e-payment. Another problem is the diversion of e-payment of taxes to accounts other than those designated at the banks. We noted that in some banks, this e-payment does not get to the designated accounts, but are posted to some accounts, even when we thought that e-payment should go direct.”
Speaking in a similar vein, the Director, Consolidated Accounts, Office of the Accountant General of the Federation, Mr. Oludare Osibote, also said that late returns in respect of unapplied funds, use of different Information Technology platforms by different banks, which had caused problems of interconnectivity, non uniformity of accounts numbers, since banks use different number of digits, as well as lack of regulatory framework on e-payment were other factors affecting the success of the scheme
One year after the introduction of e-Payment into the country, experts believe that the system needs to be fine tuned.
When the Federal Government mooted the idea of introducing the electronic-payment system in 2008, the decision was greeted by mixed reactions from experts in both the public and private sectors of the economy.
The system was officially introduced into the public sector in January 2009 to facilitate payment for goods and services, as well as minimise the level of interactions between contractors and government officials thus eliminating corrupt tendencies.
It was also meant to eliminate the use of cash to facilitate speedy payments of all transactions, fast-track the implementation of government policies through the elimination of delays in government’s payment system, enhanced real time reporting and improved quality of financial reporting system in the public sector, as well as elimination of risks associated with carrying large cash.
But one year after the flag off of the system, experts say a lot of improvement still needs to be done to enable the programme to achieve the desired objective.
The Federal Government was not unmindful of these facts when it organised a two day workshop on e-payment for Accountants-General and Auditors-General from the three tiers of government.
Speaking at the event, the Permanent Secretary, Ministry of Finance, Mr. Achi Achinuvu, admitted that there was still more work to be done to make the system achieve the desired result.
For instance, he said that as part of its ongoing reforms in the public sector, the Federal Government would from next year begin the implementation of an Integrated Financial Management Information System for the public sector.
The GIFMIS, which would be fully operational by 2011, would facilitate the end-to-end processing of the e-payment initiative.
The end-to-end e-payment initiative implies that all ministries, departments and agencies of government will be making e-payment directly to the beneficiaries from the infrastructure installed in their offices.
Already, the Office of the Accountant General of the Federation has been repositioned for the effective implementation of the system through the GIFMIS.
The move is coming on the heels of a series of complaints by contractors handling projects in remote areas over the difficulties associated with the e-payment model.
For instance, some contractors had in the past raised the alarm over information security, lack of regulatory framework, as well as infrastructural limitations associated with the payment mode.
But Achinuvu said that despite the bottlenecks associated with the mode of payment, the scheme had recorded huge success.
He said that the e-payment system, which was introduced a year ago, had helped to minimise the interaction between contractors and government officials thus eliminating corrupt tendencies.
To ensure an uninterrupted connectivity of the system, the Central Bank of Nigeria has been requested to champion the implementation of a national switch, which will serve as a platform to provide seamless interconnectivity for all banks.
He said that the workshop, with the theme, ”e-payment system and public financial management reporting system as tools for achieving transparency in government,” was coming at a time when the government budgeting process was undergoing phenomenal transformation.
He emphasised the need to kick-start the process, adding that the system would aid the computerisation of public financial management processes, from budget preparation and execution to accounting and reporting, with the help of an integrated system for financial management of line ministries, spending agencies and other public sector operations.
According to him, ”As the world moves in a direction of a global village, we cannot remain isolated within the mundane systems and practices of public sector accounting. We must keep pace with emerging trends in technological advancement.
”The present administration has continued to place emphasis on transparency, probity and accountability as a means of ensuring prudent and judicious utilisation of resources. While the commercial entities across the world are moving towards International Financial Reporting Standards, governments are harmonising with International Public Sector Accounting Standard. The Federal Government would be implementing the GIFMIS by next year.”
Speaking in the same vein, the Accountant-General of the Federation, Mr. Ibrahim Dankwaabo, urged the FG to approve the adoption of IPSAS as a form of reporting in the public sector.
”Adoption of a uniform global standard would ensure understandability of the financial statements on the part of international investors. In other words, adoption of IPSAS would increase the acceptability of accounts of Nigeria, internationally, ”he added.
But the Chairman of the Federal Inland Revenue Service, Mrs. Ifueko Omogui-Okauru said that sharp practices among Deposit Money Banks, as well as problems from switches in effecting transfers from one bank to another were major reasons why the Federal Government is yet to reaped the benefits of the e-payment system.
The FIRS boss, who spoke at the workshop, noted there was need to improve the system to enhance accountability and transparency
She said the diversion of some of the e-payment accounts, as well as the banks‘ inability to quickly reconcile the accounts when the need arose, were responsible for the complaints
According to her, ”Some of the problems we faced with e-payment at the FIRS, among others, have to do with reconciliation; being able to reconcile what is paid, what the banks received and ultimate basic account. The complaints and constraints facing accountants in FIRS are also the fact that e-payment has not been as fast as it should be.
”In fact, it‘s like we are doing the e-payment on the manual system; we have not seen the full benefits of e-payment. Another problem is the diversion of e-payment of taxes to accounts other than those designated at the banks. We noted that in some banks, this e-payment does not get to the designated accounts, but are posted to some accounts, even when we thought that e-payment should go direct.”
Speaking in a similar vein, the Director, Consolidated Accounts, Office of the Accountant General of the Federation, Mr. Oludare Osibote, also said that late returns in respect of unapplied funds, use of different Information Technology platforms by different banks, which had caused problems of interconnectivity, non uniformity of accounts numbers, since banks use different number of digits, as well as lack of regulatory framework on e-payment were other factors affecting the success of the scheme
Monday, April 12, 2010
UK’s Award-Winning Mango Launches Financial Management Training for Australian NGOs
Sydney, 12 April 2010 – Mango, the award-winning UK registered charity which helps aid agencies around the world strengthen their financial management, will launch training in Australia next month for the very first time.
Last year, Mango ran its highly practical financial management training courses for non-governmental organisations (NGOs) working in humanitarian relief and development in over 40 countries around the world, helping to improve effectiveness and accountability.
Australian NGOs will now have the opportunity to benefit from Mango running two of its most popular courses in Melbourne in May 2010. These include its highly regarded two day Financial Management for Effective Programmes – A Programme Officer’s Survival Course on 11-12 May (FM3) together with its one day course Assessing and Building Partners’ Financial Management Capacity on 13 May (FM9). The training will also now form part of Mango’s pan Asia Pacific training programme and its work with various training partners in the region.
The Melbourne events will be facilitated by Mango’s Training Partnerships Manager, Sara Holloway ACMA. Holloway is an experienced finance manager and trainer, having worked with blue chip commercial organisations in the UK and US and development and humanitarian NGOs in Kenya, India, Uganda, Sri Lanka and across Southern Africa.
Mango works with all the major international agencies, including ActionAid, Care International, CAFOD, Christian Aid, Oxfam, Plan International, the Red Cross, Save the Children, Tearfund, VSO, World Vision and their partners. It also works with a substantial and growing number of local organisations including microfinance organisations.
“Mango training aims to take the fear out of finance. These courses help to build the confidence and skills of NGO staff to use financial management tools to implement project activities effectively and accountably and to assess and strengthen local partners’ financial management systems and capacity. We’re really looking forward to running our courses in Australia,” said Mango’s Training Director, Terry Lewis.
Mango also offers humanitarian relief and development organisations easy and reliable access to high quality pre-screened finance staff with the technical skills, interpersonal competencies and commitment to work effectively with NGOs around the world.
Mango’s Recruitment Director, Lucy Markby commented: “As an NGO committed to providing high quality finance staff for permanent, interim or short term roles and consultancy assignments at affordable rates, we believe we are uniquely placed to assist NGOs with their recruitment needs all over the world.
“For example, we are currently recruiting French speaking accountants to help support Save the Children and other organisations who are committed to rebuilding Haiti in the longer term. We have over 300 accountants on Mango’s register committed to contributing their skills to the sector. There is huge demand for finance professionals within the sector so we are always delighted to hear from accountants keen to work in humanitarian relief and development organisations around the world.”
Last year, Mango ran its highly practical financial management training courses for non-governmental organisations (NGOs) working in humanitarian relief and development in over 40 countries around the world, helping to improve effectiveness and accountability.
Australian NGOs will now have the opportunity to benefit from Mango running two of its most popular courses in Melbourne in May 2010. These include its highly regarded two day Financial Management for Effective Programmes – A Programme Officer’s Survival Course on 11-12 May (FM3) together with its one day course Assessing and Building Partners’ Financial Management Capacity on 13 May (FM9). The training will also now form part of Mango’s pan Asia Pacific training programme and its work with various training partners in the region.
The Melbourne events will be facilitated by Mango’s Training Partnerships Manager, Sara Holloway ACMA. Holloway is an experienced finance manager and trainer, having worked with blue chip commercial organisations in the UK and US and development and humanitarian NGOs in Kenya, India, Uganda, Sri Lanka and across Southern Africa.
Mango works with all the major international agencies, including ActionAid, Care International, CAFOD, Christian Aid, Oxfam, Plan International, the Red Cross, Save the Children, Tearfund, VSO, World Vision and their partners. It also works with a substantial and growing number of local organisations including microfinance organisations.
“Mango training aims to take the fear out of finance. These courses help to build the confidence and skills of NGO staff to use financial management tools to implement project activities effectively and accountably and to assess and strengthen local partners’ financial management systems and capacity. We’re really looking forward to running our courses in Australia,” said Mango’s Training Director, Terry Lewis.
Mango also offers humanitarian relief and development organisations easy and reliable access to high quality pre-screened finance staff with the technical skills, interpersonal competencies and commitment to work effectively with NGOs around the world.
Mango’s Recruitment Director, Lucy Markby commented: “As an NGO committed to providing high quality finance staff for permanent, interim or short term roles and consultancy assignments at affordable rates, we believe we are uniquely placed to assist NGOs with their recruitment needs all over the world.
“For example, we are currently recruiting French speaking accountants to help support Save the Children and other organisations who are committed to rebuilding Haiti in the longer term. We have over 300 accountants on Mango’s register committed to contributing their skills to the sector. There is huge demand for finance professionals within the sector so we are always delighted to hear from accountants keen to work in humanitarian relief and development organisations around the world.”
Sunday, April 11, 2010
Career in Financial Management
Function
Financial management is the process of monitoring and reporting cash flow, conducting financial assessments, and setting up efficient systems for handling funds. Most financial management jobs can be found at commercial banks, credit unions and finance companies, but they may also be in a government office, health care industry or technology. Some financial managers may work as independent contractors to offer private services and money management advice. Overall, financial managers perform tasks that are unique to their organization.
Responsibilities
Financial management officers and professionals are responsible for: determining credit ratings and credit ceilings for the organization and its partners and/or vendors; performing collections duties on past-due accounts; preparing financial statements such as balance sheets, income statements and cash flow projections; working with the accounting department to retrieve or produce various financial reports; supervising cash management activities; analyzing financial data and providing details to the board of an organization; managing insurance budgets; and overseeing all banking activities of the organization.
Education and Training
Individuals interested in pursuing a career in financial management typically need at least a bachelor's degree in business, accounting, finance or economics to obtain an entry-level position. They may develop important skills and acquire specialized knowledge on the job, and those who wish to pursue supervisory positions can complete an MBA program. Professional training programs for financial managers are also available by the American Institute of Banking, the American Bankers Association and through various employers. Financial managers may choose to specialize in a certain field such as investments or auditing, and can pursue certification in these areas.
Career Options
In addition to serving as a chief financial officer (CFO) or financial manager for an organization, individuals with a strong background in financial management can find work as accountants, auditors, budget analysts, insurance underwriters, personal financial advisers, financial services sales agents, real estate brokers, loan officers, securities agents or financial analysts. Some professionals who hold a master's degree or higher may also pursue teaching careers at a college, university or secondary school.
Employment Prospects
Job seekers in the financial industry are expected to face tough competition. Individuals who wish to pursue financial management will need several years of experience in the field, especially in highly specialized industries. Many of these professionals are paid well. Wage and salary financial managers routinely make six-figure salaries; those who work in the securities and commodity contract industry, and managers of companies and industries, make significantly more.
Financial management is the process of monitoring and reporting cash flow, conducting financial assessments, and setting up efficient systems for handling funds. Most financial management jobs can be found at commercial banks, credit unions and finance companies, but they may also be in a government office, health care industry or technology. Some financial managers may work as independent contractors to offer private services and money management advice. Overall, financial managers perform tasks that are unique to their organization.
Responsibilities
Financial management officers and professionals are responsible for: determining credit ratings and credit ceilings for the organization and its partners and/or vendors; performing collections duties on past-due accounts; preparing financial statements such as balance sheets, income statements and cash flow projections; working with the accounting department to retrieve or produce various financial reports; supervising cash management activities; analyzing financial data and providing details to the board of an organization; managing insurance budgets; and overseeing all banking activities of the organization.
Education and Training
Individuals interested in pursuing a career in financial management typically need at least a bachelor's degree in business, accounting, finance or economics to obtain an entry-level position. They may develop important skills and acquire specialized knowledge on the job, and those who wish to pursue supervisory positions can complete an MBA program. Professional training programs for financial managers are also available by the American Institute of Banking, the American Bankers Association and through various employers. Financial managers may choose to specialize in a certain field such as investments or auditing, and can pursue certification in these areas.
Career Options
In addition to serving as a chief financial officer (CFO) or financial manager for an organization, individuals with a strong background in financial management can find work as accountants, auditors, budget analysts, insurance underwriters, personal financial advisers, financial services sales agents, real estate brokers, loan officers, securities agents or financial analysts. Some professionals who hold a master's degree or higher may also pursue teaching careers at a college, university or secondary school.
Employment Prospects
Job seekers in the financial industry are expected to face tough competition. Individuals who wish to pursue financial management will need several years of experience in the field, especially in highly specialized industries. Many of these professionals are paid well. Wage and salary financial managers routinely make six-figure salaries; those who work in the securities and commodity contract industry, and managers of companies and industries, make significantly more.
Effective Financial Management in Business
Financing plan. It is a short statement but it has an incredible impact on where your business will be in the future. When you start a business, business planning is without question, staring you right in the face...But many times small business owners let this lose its place on their list of priorities. A solidly structured plan for financial management should be on the top of your business goals today, just as much or more so, than the day that you started your business. For example: Remember the big dot com boom that came crashing down around many online business owners? A big reason for this was because of the assumed attitude of "We are filthy rich today, who needs to plan for tomorrow? It will always be like this, won't it?" Well, history has proven the answer to this to be a big flashing red NO!
To avoid these arrogant decisions and mistakes we must plan ahead. We must have a clear vision of where we are going, where we want to be, and how not sticking to our business plan will effect us. In hard times we need to weigh our options carefully. Do we take out a business loan to pay our employees when the revenue has ceased to trickle in, or did we think ahead and tuck away a portion of our profits into a business savings account for such an occasion? The success or demise of your company depends on your answer to such a question as this. Its a fact of business life. So instead of finding ourselves awestruck and helpless when the stock market crashes again next year, let us be the wise sage that plans for it now. How? Well the options are abundant, however there are a handful of tried and true methods that are always consistent winners. Select a reputable financial adviser. If you are a "do-it-yourselfer" then consider brushing up on your skills by taking an online class.You can do this from the office with minimal effort, trust me, I know.
To avoid these arrogant decisions and mistakes we must plan ahead. We must have a clear vision of where we are going, where we want to be, and how not sticking to our business plan will effect us. In hard times we need to weigh our options carefully. Do we take out a business loan to pay our employees when the revenue has ceased to trickle in, or did we think ahead and tuck away a portion of our profits into a business savings account for such an occasion? The success or demise of your company depends on your answer to such a question as this. Its a fact of business life. So instead of finding ourselves awestruck and helpless when the stock market crashes again next year, let us be the wise sage that plans for it now. How? Well the options are abundant, however there are a handful of tried and true methods that are always consistent winners. Select a reputable financial adviser. If you are a "do-it-yourselfer" then consider brushing up on your skills by taking an online class.You can do this from the office with minimal effort, trust me, I know.
The importance of financial management ethics
Money by itself is not necessarily evil. Rather, it is something that is used to trade goods and services. We call it "currency", and it allows us to do business between organizations. Unfortunately, that is the sterile dictionary-type definition but it does not capture all the issues that are involved with finances. In corporate life, just like many other realms, money causes all sorts of problems. People make incredibly bad decisions because of money, and plenty of people have gone to prison because of their money-related behavior. This is why people always approach money with a certain amount of uneasiness. Here are a few thoughts on why financial management ethics are important.
The numbers do not have a soul
Ethics are important because finances make people do some strange things. The spreadsheet does not have a conscience, and the goal of working with spreadsheets is to make numbers add up in a way that is pleasing to the organizations and it's constituents. Unfortunately, people can move around numbers in all sorts of ways to make them add up "correctly." Because of this, companies adopt financial management ethics in order to have an outside source of guidance. People are afraid (and rightly so) that without a moral barometer, anything is possible on that spreadsheet.
Financial management ethics are also important because of history. Just say "Enron" and people either laugh or get very serious. The trouble with Enron is that everyone was happy as long as the numbers kept looking good. However, much mischief was afoot at Enron and the company was running fast and loose with ethical principles. Enron is a textbook example of why financial ethics are important. Without ethics, there are truly no boundaries when it comes to organizational culture.
Expectations
Countries like the United States are built around many great things but they also flirt with danger on a regular basis. In a post-modern world, capitalism can quickly dissolve into greed and villainy. Again, companies that do not have any sort of moral code or ethical principles are really free to do whatever they want. Because shareholders and financial markets have impossibly high demands on certain companies, executives feel somewhat forced to make moral compromises. Before people know it, Enron appears again and again. Why? Because people aren't clear on their own ethical viewpoints and they are left to make decisions based on a reactionary environment. Therefore, if people are serious about living life a certain way, they must write a strict moral code and be willing to follow it, no matter what happens in the financial market.
The numbers do not have a soul
Ethics are important because finances make people do some strange things. The spreadsheet does not have a conscience, and the goal of working with spreadsheets is to make numbers add up in a way that is pleasing to the organizations and it's constituents. Unfortunately, people can move around numbers in all sorts of ways to make them add up "correctly." Because of this, companies adopt financial management ethics in order to have an outside source of guidance. People are afraid (and rightly so) that without a moral barometer, anything is possible on that spreadsheet.
Financial management ethics are also important because of history. Just say "Enron" and people either laugh or get very serious. The trouble with Enron is that everyone was happy as long as the numbers kept looking good. However, much mischief was afoot at Enron and the company was running fast and loose with ethical principles. Enron is a textbook example of why financial ethics are important. Without ethics, there are truly no boundaries when it comes to organizational culture.
Expectations
Countries like the United States are built around many great things but they also flirt with danger on a regular basis. In a post-modern world, capitalism can quickly dissolve into greed and villainy. Again, companies that do not have any sort of moral code or ethical principles are really free to do whatever they want. Because shareholders and financial markets have impossibly high demands on certain companies, executives feel somewhat forced to make moral compromises. Before people know it, Enron appears again and again. Why? Because people aren't clear on their own ethical viewpoints and they are left to make decisions based on a reactionary environment. Therefore, if people are serious about living life a certain way, they must write a strict moral code and be willing to follow it, no matter what happens in the financial market.
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