In the “To qualify or not” case, what were Jane’s choices?
- approach another partner
- contact a lawyer
- keep written notes/memos of the meeting but do nothing
- reapproach Mr. Viccio
- contact professional body
what was Jane’s dilemma?
a young auditor is being told to do sth against her better judgment
her senior professionals are acting out of self interest improperly
what can coworkers, employees, the accounting profession and the government do to help the profession make ethical choices?
coworkers: mentoring, team decision making, respect
employers: tone at the top, ethics training, culture and open communication, clear policies
accounting profession: rules, guidelines, enforcement, whistleblower encouragement
society: rules-SoX and general; example of public figures
what are the challenges/dilemmas auditors face?
personal integrity
independence from self-interest
independence from client’s interests
pre-determination of an audit outcome (want a clean opinion despite findings)
What else dilemmas?
materiality of audit findings
removal, change and jeapodization of audit evidences
jeopardization of client relationship
responsibilities of junior auditors
Tell me about Dan Potter in the dilemma case
fresh out of school
serious about ethics
possible promotion if receiving good review after this engagement
Tell me about Oliver
very stubborn, not keen for subordinates’ opinions
had previous small disagreements w/ Dan in the beginning
what problem did Dan encounter?
Found out a $1.9 M disagreement in real estate valuation w/ client
Oliver said it’s immaterial, but it consisted 7% of revenue for client’s sub
Oliver told Dan to take out his opinion page and change it to clean
what are Dan’s options?
Talk to partner in charge/concurrent review partner/ethics team
talk to authorities if firm authorities insist on Oliver’s opinion
what was lacking in the firm to encourage integrity?
promotion structure
authority hierarchy-
no outlet for ethical dilemmas