Reference no: EM133266731

Course: Accounting for Decision Making and Control 

Read the passage to answer the questions below.

Sarah was recently promoted to a managerial position at her company. With her new position, she is now responsible for overseeing the company's production factory, meaning approximately 50 factory workers now report to her. Although Sarah previously worked as an engineer and does not have any experience running a factory, she is excited to begin her new position.

At the end of her first day, Sarah is confused to see her factory workers continuing to work well past the end of their 8-hour shift. She then goes to the factory supervisor (who reports to her) to express concern because the factory does not have the budget to pay so many workers overtime. The supervisor smiles at Sarah and explains that the factory meets production goals by making the factory workers work off the clock. The workers are well aware of this expectation and went along with it in order to keep their jobs. Sarah is shocked to learn this illegal practice had become part of the company culture, but the supervisor explains that the company's CEO (who is Sarah's boss) is well aware of this expectation.

a) Critically analysis the ethical issues involved in this case

b)  Advise Sarah as to the actions that she should take.   

c) Briefly explain the elements of an effective ethical control system