Problem:
Human Habitat, a charitable organization in Taos, New Mexico, has a standing agreement with Taos State Bank. The agreement allows Habitat to overdraw its cash balance at the bank when donations are running low. In the past, Habitat manage funds wisely and rarely used this privilege. Douglas Byrd has been named president of Habitat. To expand operations, he is acquiring office equipment and spending a lot of fund-raising. During Byrd's presidency, Habitat ha maintained a negative bank balance of about $3,000.
Question:
What is the ethical issue in this situation? Do you approve or disapprove of Byrd's management of Habitat's and Taos State Bank's Funds? Why?