FNSINC504-Michael and Samantha Jones Case Study - Accounting & Finance Assignment Help

Assignment Task

Task 

Question: Make a list of two or more reasons your colleague might provide as to why it’s okay to:

a)   Jump on the bandwagon (Bandwagon bias)  (please elaborate your answer)
1.    Groupthink
2.    A need to be included

b)    Get information from a source that they know will agree with them (Confirmation bias) (please elaborate your answer)
1.    Evidence
2.    Importance

A detailed explanation of the following three models (a, b and c) - Please expound your answers for the three framework models. This assessment is a research project and it is expected that you will give serious consideration to your research and answers from your understanding and perspective.  

a) The Blanchard-Peale Framework – ensure you address the questions raised.

b) Markkula Centre Framework – ensure you explain all five approaches/dimensions.

c) The Issue-Contingent Model of Ethical Decision Making – ensure you provide details about the various components and the Jones model steps.

Case Study Scenario
Michael and Samantha Jones have operated and owned ‘Finance Broking Pty Ltd’ business for the last five years as an ACL holder. 
Their vision statement has always been: “We simplify the complexity of reaching financial goals and take pride in providing professional and ethical services to our clients. We view their success as our success.” Michael and Samantha thought long and hard about how they wanted the people in their business to behave and tried to capture that in their vision statement after they did some research into some of the industry leaders’ statements.  MFAA “Our Mission – To help our members be recognised as trusted professionals and be the client’s first choice”  FBAA “Our purpose is to assist our members to develop as business professionals and be skilled and successful finance brokers, by providing advocacy, education and support services.” 

“AFCA Our vision is to be a world class ombudsman service, by:
•    raising standards and minimising complaints 
•    meeting diverse community needs; and 
•    being trusted by all.” 

They currently have three brokers that work in the business – Bill Mason is the most recent to the business. 
Michael and Samantha have recently completed an internal audit of files and noticed a breach by Bill Mason. It appears a systematic issue was established for not advising commission charged in the credit proposal. Michael noted that all of Bill’s applications had this critical item missing. Bill’s response seemed flippant and Samantha is very concerned about the ethical ramifications as it calls into question the integrity of the company and all those who work there. 

Michael is handling the risk and legal ramifications; meanwhile when Samantha spoke to Bill about his attitude to this serious breach, Bill said “Most of my clients are not Aussies – mainly Greeks, Paki's and Lebbos. My payment is none of their business, spending time going through that irrelevant information will only cause problems and take up more time, they would think I was overpaid and might want a cut! Plus, Aussies don't bother reading anyway, those who do read it would probably not understand the fine print or how much time the loan takes!” 
Samantha is horrified to hear the negative biases Bill is revealing and also very concerned because – under new requirements of Regulatory Guide 79 - Breach Reporting by AFS licensees and credit licensees (Sept 2021) – she will need to investigate and possibly inform ASIC of these infringements. 
Bill definitely needs refresher training on ethical behaviour and the standards of ethics that a finance and mortgage broker needs to adhere to, along with addressing his appalling biases. Samantha will utilise internal documents such as Finance Broking’s Code of Ethics (see below) and their Vision Statement.

2. What principles from Finance Broking’s Code of Conduct have not been upheld by Bill in this scenario? 
Explain your response.

3.Complete the table below on how the listed misconceptions could impact Bill’s thinking and affect Bill’s role as a broker and then add one further misconception Bill could have considering the scenario in (b).

a) In the first column are some possible biases Bill could have governed his mental filter. The first example in red gives you guidance on the depth of the required answers you are to complete the rest.

4.Samantha is very concerned about Bill breaching regulation regarding commission/s. 
Research the Mortgage and Finance Association of Australia’s (MFAA) Code of Practice and the Finance Brokers Association of Australia’s (FBAA) Code of Conduct and list the two relevant responsibilities Bill should have adhered to.

5.Samantha is going to utilise Finance Broking’s Vision Statement and Code of Ethics to evaluate the situation Bill has put the company in. 

6. What are some of the impacts to Finance Broking’s reputation now that The Financial Review has released the following news to the public?

9. a) Samantha and Michael have analysed their options using the 5A’s framework. If they wanted to get some further input about what to do about the breach and the next steps, list two professionals and/or entities they could speak to?

b) Provide three questions you could ask yourself in order to decide whether you could proceed with the plan independently or if you required support?

10.Consider the actions of Bill and what you understand about Cognitive Biases. Outline two types of Cognitive Biases that Bill seems to display and explain why you have chosen them. 

11. Explain two strategies or processes Bill could use for overcoming these biases and changing his attitude.

12. Using your answers from question 8 – the 5A’s Ethical Decision-Making Framework – answer the following from Samantha and Michael’s perspective. 

Develop an implementation plan for the required ethical response, including what data to gather, with whom to communicate, and in what sequence:

a) List a minimum of two forms of information/data Samantha and Michael would need to collect. 

b) Who would Samantha and Michael need to speak with?

c) What is the sequence?

13. a) Think about what Bill might say in defence of his noncompliance in relation to his commissions.  

b) From your answers to question 13a), how would you respond to Bill from Samantha or Michael’s point of view?

Case study scenario continued:
Michael and Samantha decided to have a 1:1 meeting with Bill to firstly discuss how his breaches have impacted on the compliance of Finance Broking. They sent an email to invite Bill and a representative of his choice to take notes of the discussion. They will also issue Bill with a written warning and placing him under an undertaking as he has not been compliant with several aspects of his employment contract and ASIC guidelines.
Michael and Samantha also had to report the breaches to ASIC as they had been ongoing and cumulative. It was very stressful, but it was found to not be a significant breach as it was identified quite early, and they took measures to ensure it wouldn’t happen again in the future. The ramifications to your reputation have been quite widespread and they will need to issue a formal statement to their previous and current clients to explain and regain their trust.

14. a) From Bill’s point of view do you think the issue has been resolved? Answer Yes or No and explain your reasoning.
b) From Samantha/Michael’s perspective do you think the issue has been resolved? Answer Yes or No and explain your reasoning.
c) From ASIC’s point of view do you think the issue has been resolved? Answer Yes or No and explain your reasoning.

15.Imagine you were a mortgage broker at Finance Broking, do you agree with the outcomes in relation to:
a) How Samantha/Michael handled the ethical and compliance issue? Explain why/why not. 

b) How Bill complied and dealt with the situation? Explain why/why not.

c) Your own values? Explain why/why not.

16. What a journey Finance Broking and the team have had!  Thinking back over the Case Study, how could you improve upon responding to future ethical situations?

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