Two Short Case Studies in Staff Auditor and Student Ethical Decision Making

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Two Short Case Studies in Staff Auditor and Student Ethical Decision Making

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Introduction
The present report is developed to analyze the ethical scenarios presented in the case
study given. The scenario’s given relates to professional and personal code of ethics to be
followed for complying effective with ethical principles and procedures. The professional
scenario has presented a case where a certified public accountant has not complied with his
duties. The second scenario depicts the case of a student who has acted against the integrity code
of ethics. As such, the report presents an analysis of the ethical concerns in the given two
scenarios with the application of ethical frameworks.
1. Standards& Principles of Ethics Violated by Johnny and Marry
The professional scenario represents the situation of violation of code of ethics
established for the public accountants. Johnny, engaged in carrying out audit of ABC Company,
has not fulfilled his duties effectively as discovered by the firm manager before the inspection of
PCAOB (Public Company Accounting Oversight Board) (Public Company Accounting
Oversight Board (PCAOB), 2004). The work paper submitted by Johnny before the inspection
does not include supporting worksheet and signed engagement letter. Johnny has added an
earlier version found on his computer hard drive as supporting sheet after his manager direction
and also the engagement letter is inserted into the file later without proper explanation of its
subsequent reasons. The ethical standard violated by Johnny as per the professional code of
ethics is professional competence and care (Professional ethics, 2018). As per the ethical
standard, the professional accountants hold the responsibility of carrying out their duties as per
the legislations and should act diligently as per the ethical standards. Johnny has not
demonstrated full competency in carrying out their roles and responsibilities as he has not

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maintained proper record of worksheet and also engagement letter. Johnny can be sanctioned by
the firm or PCAOB due to negligence of his duties as per the Public Accountancy Act that ahs
provided the working standards for professional accountants (Langenderfer and Rockness, 1989).
In the second scenario of students, Mary Jo has acted against the ethics of integrity. She
has issued a certificate of being aware of integrity code of ethics but has avoided the code by
studying from the test paper that is meant only for instructor use. This is because she has violated
the code of ethics maintained by the University for the Students and therefore liable to gain
punishment from the university (Cheng and Flasher, 2016).
2. The main stakeholders in each case
Professional Scenario
On the basis of case study provided there only one other stakeholders other than the
Johnny. The stakeholder will be manager of the company he is much impacted by the decision of
the Johnny. So it vital to known here that the decision to add the working paper through applying
unfair means as audit standard requires working paper should be properly made through carrying
out proper audit process. In order to save the time and to provide the manager with the working
paper he taken from working paper from old hard drive put the tick marks without even checking
them properly. This action by Johnny will put the manager of the company in trouble as Public
Company Accounting Oversight Board (PCAOB) will question about the integrity of the
working paper that auditor has provided and also review the engagement letter. As all these
documents are not original and has no supporting evidence to prove that these documents are
made at the time of real audit process carried out by the Johnny (James, 2015).
Student Scenario