Accounting Theory and Contemporary Issues : Doc

Running head: ACCOUNTING THEORY AND CONTEMPORARY ISSUES
Accounting Theory and Contemporary Issues
Name of the Student
Name of the University
Author’s Note

1ACCOUNTING THEORY AND CONTEMPORARY ISSUES
Table of Contents
Answer to Question 1......................................................................................................................2
Answer to Question 2......................................................................................................................3
Answer to Question 3......................................................................................................................4
Answer to Question 4......................................................................................................................5
Answer to Question 5......................................................................................................................6
References........................................................................................................................................8

2ACCOUNTING THEORY AND CONTEMPORARY ISSUES
Answer to Question 1
Professional Scenario: As per the given scenario, Johnny is the audit in-change in ABC
Company (ABC) and PCAOB is going to visit the company for inspection. Another major
purpose of this visit can be the investigation of the audit works of ABC. It can be observed that
audit work paper is not completed as two major documents are missing that are key item
worksheet and signed audit engagement letter. After obtaining work paper from the initial issue,
the engagement letter including the signature was still missing. At the manager’s request, Johnny
has obtained the signature of the client without disclosing the actual date and intension of the
inclusion. It implies that Johnny has breached the principle of objectivity (Houghton and
Campbell 2013). As per this principle, the auditors are required to show professionalism at the
time to collect, analyze and communicate information for auditing activities. In addition, the
auditors should not compromise the professional judgment under any influence. In the given
case, the manager of ABC has influence on Johnny for the submission of audit work papers.
Hence, Johnny is not impartial as well as independent (Beauchamp and Bowie 2014).
Thus, PCAOB has the authority to sanction Johnny as he has not acted in the favor of the
stakeholders and his acts are highly unprofessional. Hence, Johnny and the manager should face
the necessary consequences for adopting illegal measures to submit the work paper.
Student Scenario: As per the given scenario, Mary Jo downloads the test books from the website
in spite of the fact that they are only for the use of the instructors. By doing this, she has been
able to secure good marks in the exam. With this action, Mary Jo has breached the principles of
fairness, honesty, integrity, responsibility and legality. As per these principles, an individual is
required to be knowledgeable, understanding and truthful in order to ensure honesty in learning.

3ACCOUNTING THEORY AND CONTEMPORARY ISSUES
As per the scenario, Mary Jo has taken a dishonest way for getting good marks and it violates the
principle of honesty. As per the principle of fairness, there needs to be equality in procedures and
practices. Thus, by taking unethical services from Samantha, Mary Jo has not been able to
maintain the principle (Peters 2015).
In this context, it is the responsibly of both Mary Jo and Samantha to maintain academic
integrity. However, in spite of the notification provided by the website that the test banks are for
the instructors, Mary Jo has downloaded them and it contributes to the violation of legality as
well as integrity principle. For this reason, the institution has the authority to sanction Mary Jo
for his actions (Chan 2014).
Answer to Question 2
Professional Scenario: In this case, the major stakeholders are ABC, the manager and PCAOB.
The major issue for ABC is the missing of two major documents that can create major effect on
the books of the company. In case ABC fails to obtain relevant information for the accounts,
stakeholders can raise questions for the trustworthiness about the financial information of the
company and it can lead to the loss of trust of the shareholders (Verbeke and Tung 2013).
Another major stakeholder is the manager. Johnny has carried out the working paper related
activities at the direction of the managers. In addition, the manager has also provided the
direction to reprint the work paper. In this context, PCAOB can question the responsibility of the
manager towards the company as he has provided Johnny the required assistance for hiding the
mistakes. For this reason, PCAOB can warn the manager as well as can terminate him for such
irresponsible actions (Verbeke and Tung 2013).

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Student Scenario: Apart from Mary Jo, two other stakeholders are Samantha and the university.
It can be observed that Mary Jo has downloaded the test banks from the website in spite of the
restrictions at the suggestion of Samantha. In case, the university can catch Mary Jo for the use
of test banks, the university can suspend Mary Jo or expulse her (Mok, Shen and Yang 2015). At
this time, in case Mary Jo confesses to the university that she has got the advice of using test
banks from Samantha, then the same consequences can be happened to Samantha. University is
another stakeholder. As per the regulation of the university, every student is required to comply
with rules and regulations. In this case, there is a violation of academic integrity of the university
and the university would be required to take more strict actions against this (Mok, Shen and
Yang 2015).
Answer to Question 3
Professional Scenario: From the given scenario, it can be observed that Johnny has carried out
the activities at the direction of the managers of ABC. The situation shows the delivery of work
papers to the office of the manager before the arrival of the officers from PCAOB. Johnny is
audit in-change at ABC; for this reason, some staffs word be working under him in the company.
The final audit report is deliverer to ABC after carrying out of all the required audit works.
However, it can be observed that the managers of ABC has lost some of the original files and
asked for the additional copies. Thus, in this situation, Johnny could say that they have already
delivered the correct report with all the related information to the company and the negligence of
the management of ABC was responsible for the loss of papers. From this point of view, the
decision of Johnny can be rationalized (Kaptein 2015).

5ACCOUNTING THEORY AND CONTEMPORARY ISSUES
Student Scenario: From the provided scenario, it can be observed that Mary Jo and Samantha
studies together in the same university. Mary Jo has been tired due to exam pressure and she
lacks in the subject, Accounting 355. As it would be Mary Jo’s third exam in the week, she
might not be able to secure pass marks in the examination due to pressure. In order to rationalize
her behavior, Mary Jo can be said that she has used the test banks just for reference and they
have helped her in gaining knowledge in the subject of the examination. With the help of these
test banks, she has been able to secure good marks in the examination that would help her in the
development of her professional carrier. In this manner, Mary Jo can rationalize her behavior
(Brooks, Te Riele and Maguire 2014).
Answer to Question 4
Professional Scenario: As per the provided scenario, it can be seen that even through the loss of
the supporting worksheet, an electronic version of that document was there in the hard drive of
the computer of Johnny. At the direction of the manager, it was reprinted and included in the file
before the arrival of the PCAOB officials without providing any explanation and date. Apart
from this, Johnny has also included the original signature of the client without mentioning the
true date. In this context, Johnny had the option to inform the senior management of ABC about
the direction of the manager. Apart from this, Johnny also had the option to put restriction in the
action of the manager in manipulating the revised documents in order to maintain the
professional as well as personal integrity (Hay, Knechel and Willekens 2014).
Student Scenario: In this particular case, Mary Jo had the option not to use the test banks by
complying with the instruction of the website that they are only for the use of the instructors. In
addition, she could have prevented Samantha from using the same by explaining her

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consequences they might be faced. These particular actions would maintain the personal as well
as the integrity of the whole university (Biesta 2015).
Answer to Question 5
Professional Scenario: After the revelation of the acts of Johnny, the following discussion
shows the main reasons behind his silence:
 Johnny has acted in the interest of the manager of ABC as it would ensure the fulfillment
of his personal interest as well.
 There was major manipulation in the disclosure of the key financial items without
delivering adequate justification for the delay in the work file.
 There was meetings between the clients of ABC and Johnny that contributed towards the
violation of the principles of independence and confidentiality due to the disclosure of
the confidential financial information of ABC (Jefrey 2018).
Thus, in this context, Johnny had the option to inform the management of ABC about the
direction of the manager that he received along with the delivery of accurate information to the
officials of PCAOB (Jefrey 2018).
Student Scenario: After the revelation of the acts of Mary Jo, the following discussion shows the
main reasons behind her silence:
 Mary Jo has violated the instruction of the website by using the test banks for securing
good marks.
 Mary Jo also provided wrong certificate hat she had complied with all the rules and
regulations of the university.

7ACCOUNTING THEORY AND CONTEMPORARY ISSUES
 Her confession might have negative consequences on her career progress (Giacalone and
Promislo 2013).
Thus, in this scenario, Mary Jo had the option to stop using the test banks and she could also
prevent Samantha from using the same by remanding her about the rules and regulations of the
university (Giacalone and Promislo 2013).

8ACCOUNTING THEORY AND CONTEMPORARY ISSUES
References
Beauchamp, T.L. and Bowie, N.E. eds., 2014. Ethical theory and business. Pearson.
Biesta, G.J., 2015. Good education in an age of measurement: Ethics, politics, democracy.
Routledge.
Brooks, R., Te Riele, K. and Maguire, M., 2014. Ethics and education research. Sage.
Chan, R., 2014. Ethics in education.
Giacalone, R.A. and Promislo, M.D., 2013. Broken when entering: The stigmatization of
goodness and business ethics education. Academy of Management Learning & Education, 12(1),
pp.86-101.
Hay, D., Knechel, W.R. and Willekens, M. eds., 2014. The Routledge companion to auditing.
Routledge.
Houghton, K. and Campbell, T., 2013. Ethics and Auditing.
Jefrey, C. ed., 2018. Research on professional responsibility and ethics in accounting. Emerald
Publishing Limited.
Kaptein, M., 2015. The effectiveness of ethics programs: The role of scope, composition, and
sequence. Journal of business ethics, 132(2), pp.415-431.
Mok, K.Y., Shen, G.Q. and Yang, J., 2015. Stakeholder management studies in mega
construction projects: A review and future directions. International Journal of Project
Management, 33(2), pp.446-457.

9ACCOUNTING THEORY AND CONTEMPORARY ISSUES
Peters, R.S., 2015. Ethics and Education (Routledge Revivals). Routledge.
Verbeke, A. and Tung, V., 2013. The future of stakeholder management theory: A temporal
perspective. Journal of Business Ethics, 112(3), pp.529-543.