A company restructure

March 2023

We outline a case from the CCAB’s ethical dilemmas for professional accountants working in business Outline of the case.

You are a qualified accountant. You have been asked, by your line manager, to complete a costing exercise with a very short deadline and limited resources. You think that the chief executive of the company is planning to use this information to restructure the company, including making some of your close colleagues redundant. You are worried that your work cannot be robust enough to be used for such a big business decision, but your line manager is putting you under a lot of pressure to complete the work quickly.


As a professional accountant in business:

a. Which fundamental principles feature more prominently for safeguarding?

b. What would be your key considerations in your approach to resolving the dilemma presented?

c. What course of action would you take to resolve the dilemma?

Key fundamental principles

Objectivity: Could you maintain an unbiased stance throughout, in view of your close relationship with your colleagues?

Professional competence and due care: Can you realistically produce a costing, with the time and resources available, without compromising the standard of your work?

Confidentiality: Given the sensitivity of the situation, you should maintain discretion and not share your concerns with other staff, who may not be aware of the chief executive’s intentions.


Identify relevant facts: You suspect that the company may be restructuring, and the chief executive needs to have the most up to date and complete financial information to inform any decisions. As a professional accountant, you must ensure that any financial information you provide is robust.

Identify affected parties: Key affected parties are you, your line manager, the chief executive and anyone else who may use the results of the costing exercise. Other stakeholders in the company may also be affected, including those employees whose roles might be made redundant.

Who should be involved in the resolution: Is there anyone else in the company with whom you can raise your concerns? Is there a senior finance officer who could advise you, or another member of the board of directors with whom you can discuss your dilemma? Should you approach the chief executive directly?

Possible course of action

You think that the chief executive of the company is planning to use the information you produce to restructure the company. As a professional accountant, you have a duty to make your line manager and other users of the information aware of the limitations in the scope of your work. With this in mind, you should attempt to obtain certainty regarding the use of the information.

You should arrange a meeting with your line manager and explain your concerns that you may be unable to do the work to a sufficient level of quality in the time available. You could ask for more time to complete the work to the required standard or suggest alternative approaches such as outsourcing.

Outsourcing the work could have the added benefit of enhanced objectivity, although given the tight deadline it may require your assistance to ensure ready and efficient access to all necessary information. The process of clarifying the intended use of the information and expressing your concerns regarding its reliability is likely to enhance your credibility. You could suggest that your line manager discuss the issue with the chief executive or those charged with governance (such as other members of the board of directors), as appropriate.

If your line manager is unsympathetic to your concerns, you should not allow yourself to be associated with information that may be misleading. You should consider the most appropriate way in which to make your concerns known to the board of directors. This may be through the chief executive or the company secretary.

If, after exploring all these routes of communication, you still find yourself under unreasonable time pressure, you may have to make clear your refusal to conduct the work, and possibly resign from the company. However, resigning is not a substitute for taking required actions.
You should document, in detail, the steps that you take in resolving your dilemma, in case your ethical judgement is challenged in the future.

• The CCAB case studies illustrate how the codes of ethics of the CCAB bodies can be applied by professional accountants and the five sets can be found at https://tinyurl.com/ycxj4pxx