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Scenario or tasks

Mariam had great expectations about her future as she sat at her graduation ceremony in May 2015. She was about to receive her Master of Accountancy degree, and the following week she would begin her career on the audit staff of Green, Thresher & Co., a public accounting firm. Things looked a little different to Barbara in February 2016. She was working on the audit of Delancey Fabrics Ltd., a textile manufacturer with a calendar year end. The pressure was enormous. Everyone on the audit team was putting in 70-hour weeks, and it still looked as if the audit would not be done on time. Barbara was doing work in the property area, vouching additions for the year. The audit program indicated that a sample of all items over $10,000 should be selected, plus a non-statistical sample of smaller items. When Mariam went to take the sample, Ahmed, the senior, had left the client’s office and could not answer her questions about the appropriate size of the judgmental sample. Mariam forged ahead and selected 50 smaller items on her own judgment. Her basis for doing this was that there were about 250 such items, so 50 was a reasonably good proportion of such additions. Mariam audited the additions with the following results: The items over $10,000 contained no errors; however, the 50 small items contained a large number of errors. In fact, when Mariam projected them to all such additions, the amount seemed quite significant.

A couple of days later, Ahmed returned to the client’s office. Mariam brought her work to Ahmed in order to inform him of the problems she found, and got the following response: “My God, Mariam , why did you do this? You were supposed to look only at the items over $10,000, plus 5 or 10 little ones. You’ve wasted a whole day on that work, and we can’t afford to spend any more time on it. I want you to throw away the schedules where you tested the last 40 small items and forget you ever did them.”

When Mariam asked about the possible audit adjustment regarding the small items, none of which arose from the first 10 items, Ahmed responded, “Don’t worry, it’s not material anyway. You just forget it; it’s my concern, not yours.”

REQUIRED :

1- Explain how certified Public accountants are different from other professionals and examine the role of code of professional conduct in encouraging CPAs ethical behaviour. ( word limit 150-200)

2- In what way is this an ethical dilemma for Mariam? ( word limit 75- 100)

3- Use the five-step giving voice to values approach to resolve the ethical dilemma. ( word limit 150-200)

4- Discuss whether the facts in above case indicate violations of the rules of conduct for professional accountants. If so, identify the nature of the violation(s). ( word limit 150-200)

Assignment Format:

introduction (75 – 100 ) words

main body ( question’s answers) (700-800) words

conclusion (75 – 100 ) words

important note // the answers of q1, q2 and q3 is provided in attached file, so just paraphrase and summarize , but q4 not provided so solve it

Name of the book

Auditing and Assurance Services: An Integrated Approach, Fourteenth Edition
ISBN-13: 978-0-13-257595-9
Author(s): Alvin A. Arens; Randal J. Elder; Mark S. Beasley
eText: ISBN-10 0-13-257597-3, ISBN-13 978-0-13-257597-3
Print: ISBN-10 0-13-257595-7, ISBN-13 978-0-13-257595-9
Author(s): Alvin A. Arens; Randal J. Elder; Mark S. Beasley
Publisher: Prentice Hall

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