CNST4335 - Construction Management IIEthics AssignmentEthics.docx

CNST4335 - Construction Management II
Ethics Assignment
Ethics is a cornerstone of professional construction practice.
This assignment is to help students to gain a better
understanding of ethics standards through a real-life case study.
This assignment is also an assessment of your written
communication skills. Please take the time to write well to
ensure a high grade.
Instruction
Read the attached Ethic Case Study and reference any code of
ethics adopted by any professional or trades organization to
answer the following questions:
Q1. What is the main ethical issue in the case study? Describe
any circumstances to help the reader to fully appreciate the
issue.
Q2. What caused the issue/problem in the first place?
Q3. Imagine you were one of the paving contractors and were
asked to participate again in the complementary bidding.
What will you do? Explain your reasons.
1. You will agree to participate with the understanding that each
contractor has its fair turn to receive awards in future projects.
2. You will decline to participate and you will prepare your bid
independently.
3. You will decline to participate and report the complimentary
bidding practice to the client, i.e. the state agency
Q4. Discuss your rationale for declining the other option.
Evaluation
Criteria
points
I. Technical Merit (7 points)
· Q1 & Q2 (300 words minimum)
/3
· Q3 & Q4 (500 words minimum)

/4
II. Writing skill (3 points)
· Use of appropriate grammar, spelling, and MLA format (see
sample in Blackboard)
/1.5
· Logic structure & development of ideas
/1.5
TOTAL
/10pt
Deadline: Please submit your solution in Blackboard (click
“Ethics Assignment” link on the left navigation menu) prior to
the due date.
Complementary Bidding in Construction Projects
SITUATION:
Several paving contractors in two southern states participated in
an anticompetitive scheme known as complementary bidding or
bid rigging. Prospective competitors on a particular paving
contract would select a “winning” bidder amongst themselves.
The designated contractor would submit its bid for the project,
while the other contractors would knowingly submit bids having
a higher dollar amount or containing terms the contractors knew
would be unacceptable to the state entity letting the contract.
The scheme would thus create the illusion of a competitive
bidding process while ensuring that a particular paving
contractor ultimately received the contract award.
2
This comprehensive case requires students to evaluate a static
budget and prepare flexible budgets to meet managerial needs.
Students are required to calculate and analyze variances and
discuss how variances are critical to managerial decision

making.
Scenario: GP is a 400-acre farm on the outskirts of the
Kentucky Bluegrass, specializing in the boarding of broodmares
and their foals. A recent economic downturn in the
thoroughbred industry has led to a decline in breeding
activities, and it has made the boarding business extremely
competitive. To meet the competition, GP planned in 2017 to
entertain clients, advertise more extensively, and absorb
expenses formerly paid by clients such as veterinary and
blacksmith fees.
The budget report for 2017 is presented as an attachment. As
shown, the static income statement budget for the year is based
on an expected 21,900 boarding days at $25 per mare. The
variable expenses per mare per day were budgeted: feed $5,
veterinary fees $3, blacksmith fees $0.25, and supplies
$0.55. All other budgeted expenses were either semifixed or
fixed.
During the year, management decided not to replace a worker
who quit in March, but it did issue a new advertising brochure
and did more entertaining of clients.
Minimum of 700 words examination of the financial statements
and include the following based on the static budget report:
· What was the primary cause(s) of the loss in net income?
· Did management do a good, average, or poor job of
controlling expenses?
· Were management's decisions to stay competitive sound?
· Prepare a flexible budget report for the year.
· Based on the flexible budget report:
· What was the primary cause(s) of the loss in net income?
· Did management do a good, average, or poor job of
controlling expenses?

· Were management's decisions to stay competitive sound?
· What course of action do you recommend for the management
of Green Pastures?
Show your work in Microsoft Word or Excel.
Complete calculations/computations using Microsoft Word or
Excel.
GP
Static Budget Income Statement
For the Year Ended December 31, 2017
ActualMaster BudgetDifference
Number of Mares 5260 8 U
Number of Boarding Days
19,00021,9002,900 U
Sales $380,000$547,500$167,500
U
Less: Variable Expenses
Feed 104,390 109,500
5,110 F
Veterinary Fees 58,838
65,700 6,862 F
Blacksmith Fees 4,984
5,475 491 F
Supplies 10,17812,0451,867 F
Total Variable Expenses 178,390192,72014,330 F
Contribution Margin 201,610354,780153,170 U
Less: Fixed Expenses
Depreciation 40,000
40,000 -0-
Insurance 11,000 11,000 -
0-

Utilities 12,000
14,000 2,000 F
Repairs and Maintenance 10,000
11,000 1,000 F
Labor 88,000
95,000 7,000 F
Advertisement 12,000
8,000 4,000 U
Entertainment 7,0005,0002,000 U
Total Fixed Expenses 180,000184,0004,000
F
Net Income $21,610$170,780$149,170
U
Code of Ethics1
Fundamental Principles2
Engineers uphold and advance the integrity, honor and dignity
of the
engineering profession by:
1. using their knowledge and skill for the enhancement of
human welfare
and the environment;
2. being honest and impartial and serving with fidelity the
public, their
employers and clients;

3. striving to increase the competence and prestige of the
engineering
profession; and
4. supporting the professional and technical societies of their
disciplines.
Fundamental Canons
1. Engineers shall hold paramount the safety, health and welfare
of the
public and shall strive to comply with the principles of
sustainable
development3 in the performance of their professional duties.
2. Engineers shall perform services only in areas of their
competence.
3. Engineers shall issue public statements only in an objective
and
truthful manner.
4. Engineers shall act in professional matters for each employer
or client
as faithful agents or trustees, and shall avoid conflicts of
interest.
5. Engineers shall build their professional reputation on the
merit of their
services and shall not compete unfairly with others.
6. Engineers shall act in such a manner as to uphold and
enhance the
honor, integrity, and dignity of the engineering profession and
shall act
with zero-tolerance for bribery, fraud, and corruption.

7. Engineers shall continue their professional development
throughout
their careers, and shall provide opportunities for the
professional
development of those engineers under their supervision.
Guidelines to Practice Under the Fundamental Canons of Ethics
CANON 1.
Engineers shall hold paramount the safety, health and welfare of
the public
and shall strive to comply with the principles of sustainable
development in
the performance of their professional duties.
a. Engineers shall recognize that the lives, safety, health and
welfare of
the general public are dependent upon engineering judgments,
decisions and practices incorporated into structures, machines,
products, processes and devices.
b. Engineers shall approve or seal only those design documents,
reviewed or prepared by them, which are determined to be safe
for
public health and welfare in conformity with accepted
engineering
standards.
c. Engineers whose professional judgment is overruled under

circumstances where the safety, health and welfare of the public
are
endangered, or the principles of sustainable development
ignored,
shall inform their clients or employers of the possible
consequences.
d. Engineers who have knowledge or reason to believe that
another
person or firm may be in violation of any of the provisions of
Canon 1
shall present such information to the proper authority in writing
and
shall cooperate with the proper authority in furnishing such
further
information or assistance as may be required.
e. Engineers should seek opportunities to be of constructive
service in
civic affairs and work for the advancement of the safety, health
and
well-being of their communities, and the protection of the
environment
through the practice of sustainable development.
f. Engineers should be committed to improving the environment
by
adherence to the principles of sustainable development so as to
enhance the quality of life of the general public.
CANON 2.
Engineers shall perform services only in areas of their
competence.
a. Engineers shall undertake to perform engineering assignments

only
when qualified by education or experience in the technical field
of
engineering involved.
b. Engineers may accept an assignment requiring education or
experience outside of their own fields of competence, provided
their
services are restricted to those phases of the project in which
they are
qualified. All other phases of such project shall be performed by
qualified associates, consultants, or employees.
c. Engineers shall not affix their signatures or seals to any
engineering
plan or document dealing with subject matter in which they lack
competence by virtue of education or experience or to any such
plan
or document not reviewed or prepared under their supervisory
control.
CANON 3.
Engineers shall issue public statements only in an objective and
truthful
manner.
a. Engineers should endeavor to extend the public knowledge of
engineering and sustainable development, and shall not
participate in
the dissemination of untrue, unfair or exaggerated statements
regarding engineering.

b. Engineers shall be objective and truthful in professional
reports,
statements, or testimony. They shall include all relevant and
pertinent
information in such reports, statements, or testimony.
c. Engineers, when serving as expert witnesses, shall express an
engineering opinion only when it is founded upon adequate
knowledge
of the facts, upon a background of technical competence, and
upon
honest conviction.
d. Engineers shall issue no statements, criticisms, or arguments
on
engineering matters which are inspired or paid for by interested
parties, unless they indicate on whose behalf the statements are
made.
e. Engineers shall be dignified and modest in explaining their
work and
merit, and will avoid any act tending to promote their own
interests at
the expense of the integrity, honor and dignity of the
profession.
CANON 4.
Engineers shall act in professional matters for each employer or
client as
faithful agents or trustees, and shall avoid conflicts of interest.
a. Engineers shall avoid all known or potential conflicts of
interest with
their employers or clients and shall promptly inform their
employers or

clients of any business association, interests, or circumstances
which
could influence their judgment or the quality of their services.
b. Engineers shall not accept compensation from more than one
party for
services on the same project, or for services pertaining to the
same
project, unless the circumstances are fully disclosed to and
agreed to,
by all interested parties.
c. Engineers shall not solicit or accept gratuities, directly or
indirectly,
from contractors, their agents, or other parties dealing with
their
clients or employers in connection with work for which they are
responsible.
d. Engineers in public service as members, advisors, or
employees of a
governmental body or department shall not participate in
considerations or actions with respect to services solicited or
provided
by them or their organization in private or public engineering
practice.
e. Engineers shall advise their employers or clients when, as a
result of
their studies, they believe a project will not be successful.
f. Engineers shall not use confidential information coming to
them in the
course of their assignments as a means of making personal

profit if
such action is adverse to the interests of their clients, employers
or
the public.
g. Engineers shall not accept professional employment outside
of their
regular work or interest without the knowledge of their
employers.
CANON 5.
Engineers shall build their professional reputation on the merit
of their
services and shall not compete unfairly with others.
a. Engineers shall not give, solicit or receive either directly or
indirectly,
any political contribution, gratuity, or unlawful consideration in
order
to secure work, exclusive of securing salaried positions through
employment agencies.
b. Engineers should negotiate contracts for professional services
fairly
and on the basis of demonstrated competence and qualifications
for
the type of professional service required.
c. Engineers may request, propose or accept professional
commissions
on a contingent basis only under circumstances in which their
professional judgments would not be compromised.
d. Engineers shall not falsify or permit misrepresentation of
their

academic or professional qualifications or experience.
e. Engineers shall give proper credit for engineering work to
those to
whom credit is due, and shall recognize the proprietary interests
of
others. Whenever possible, they shall name the person or
persons who
may be responsible for designs, inventions, writings or other
accomplishments.
f. Engineers may advertise professional services in a way that
does not
contain misleading language or is in any other manner
derogatory to
the dignity of the profession. Examples of permissible
advertising are
as follows:
o Professional cards in recognized, dignified publications, and
listings in rosters or directories published by responsible
organizations, provided that the cards or listings are consistent
in size and content and are in a section of the publication
regularly devoted to such professional cards.
o Brochures which factually describe experience, facilities,
personnel and capacity to render service, providing they are not
misleading with respect to the engineer's participation in
projects
described.
o Display advertising in recognized dignified business and
professional publications, providing it is factual and is not
misleading with respect to the engineer's extent of participation

in projects described.
o A statement of the engineers' names or the name of the firm
and
statement of the type of service posted on projects for which
they render services.
o Preparation or authorization of descriptive articles for the lay
or
technical press, which are factual and dignified. Such articles
shall not imply anything more than direct participation in the
project described.
o Permission by engineers for their names to be used in
commercial advertisements, such as may be published by
contractors, material suppliers, etc., only by means of a modest,
dignified notation acknowledging the engineers' participation in
the project described. Such permission shall not include public
endorsement of proprietary products.
g. Engineers shall not maliciously or falsely, directly or
indirectly, injure
the professional reputation, prospects, practice or employment
of
another engineer or indiscriminately criticize another's work.
h. Engineers shall not use equipment, supplies, laboratory or
office
facilities of their employers to carry on outside private practice
without
the consent of their employers.
CANON 6.
Engineers shall act in such a manner as to uphold and enhance
the honor,

integrity, and dignity of the engineering profession and shall act
with zero-
tolerance for bribery, fraud, and corruption.
a. Engineers shall not knowingly engage in business or
professional
practices of a fraudulent, dishonest or unethical nature.
b. Engineers shall be scrupulously honest in their control and
spending of
monies, and promote effective use of resources through open,
honest
and impartial service with fidelity to the public, employers,
associates
and clients.
c. Engineers shall act with zero-tolerance for bribery, fraud, and
corruption in all engineering or construction activities in which
they are
engaged.
d. Engineers should be especially vigilant to maintain
appropriate ethical
behavior where payments of gratuities or bribes are
institutionalized
practices.
e. Engineers should strive for transparency in the procurement
and
execution of projects. Transparency includes disclosure of
names,

addresses, purposes, and fees or commissions paid for all agents
facilitating projects.
f. Engineers should encourage the use of certifications
specifying zero-
tolerance for bribery, fraud, and corruption in all contracts.
CANON 7.
Engineers shall continue their professional development
throughout their
careers, and shall provide opportunities for the professional
development of
those engineers under their supervision.
a. Engineers should keep current in their specialty fields by
engaging in
professional practice, participating in continuing education
courses,
reading in the technical literature, and attending professional
meetings
and seminars.
b. Engineers should encourage their engineering employees to
become
registered at the earliest possible date.
c. Engineers should encourage engineering employees to attend
and
present papers at professional and technical society meetings.
d. Engineers shall uphold the principle of mutually satisfying
relationships
between employers and employees with respect to terms of
employment including professional grade descriptions, salary
ranges,
and fringe benefits.

1 The Society’s Code of Ethics was adopted on September 2,
1914 and was most recently
amended on July 23, 2006. Pursuant to the Society’s Bylaws, it
is the duty of every Society
member to report promptly to the Committee on Professional
Conduct any observed
violation of the Code of Ethics.
2 In April 1975, the ASCE Board of Direction adopted the
fundamental principles of the Code
of Ethics of Engineers as accepted by the Accreditation Board
for Engineering and
Technology, Inc. (ABET).
3 In October 2009, the ASCE Board of Direction adopted the
following definition of
Sustainable Development: “Sustainable Development is the
process of applying natural,
human, and economic resources to enhance the safety, welfare,
and quality of life for all of
the society while maintaining the availability of the remaining
natural resources.”
American Institute of Constructors

Ethics is at the center of being a Professional Constructor.
Having individuals who share a common
ethical standard is essential for the construction industry. The
AIC asks that all AIC Members, ACs and
CPCs to commit to the following AIC Constructor Code of
Ethics.
AIC Code of Ethics for Constructors
The construction profession relies upon a system of ethical
competence, management excellence, and
fair dealing in undertaking complex works to serve the public
with safety, efficiency, and economy. The
members of the American Institute of Constructors are
committed to the following Standards of
Professional Conduct:
fulfilling his or her responsibilities to
the employer or client.
eptive practice, or
in any practice which creates an
unfair advantage for the Constructor or another.
attempt to injure, whether directly or

indirectly, the professional reputation of others.
which includes advice, such advice shall
be fair and unbiased.
company, information of a confidential
nature acquired during the course of professional activities.
with current professional practice, so
far as it lies within his or her power.
development in the construction process
appropriate to the type and level of his or her responsibilities
and shall support research and the
educational processes associated with the construction
profession.

CNST4335 - Construction Management IIEthics AssignmentEthics.docx

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