Auditing Report - Ethical Issues

1059 WordsMay 27, 20125 Pages
Auditing 300 Semester 1, 2012 Assessment one: Individual report Ethical issues in auditing Executive Summary This report provides an analysis of dealing with professional and ethical issues when offering auditing services. It gives a brief decision-making process model by first identifying the key issues and relevant standards involved in the case and then combining theories with reality and giving a short conclusion and some recommendations at the end. 1.0 Introduction Ethical issues in auditing are situations where individuals have to make a choice from unclear and complex alternatives in auditing, where each alternative may be the right choice according to a specific moral position or viewpoint. (Leung et al.2011)…show more content…
(ICAA Auditing and Assurance Handbook 2012)John’s business judgment was clearly influenced by his partner’s action. As a professional accountant, John was supposed to be independent both in mind and appearance. (ICAA Auditing and Assurance Handbook 2012, section 290) Nevertheless, John’s independence was somehow violated due to the conflict of opinions within the audit team. Taking the unfaithful conclusion in the replacing report affects the professional performance of the whole audit team. The second ethical issue involved in this case is whether the audit team embodies integrity in their audit performance. APES 110 s110 says that the principle of integrity imposes an obligation on all Members to be straightforward and honest in all professional and business relationships. (ICAA Auditing and Assurance Handbook 2012)Integrity also implies fair dealing and trustfulness. (ICAA Auditing and Assurance Handbook 2012)In this case, John’s partner, Chandler may encounter self-interest threat, familiarity threat and intimidation threat. He might involve himself in a financial relationship with their client or get too close to their client or feel intimidated by their client. As a result, Chandler offered a pretty-looking report about Moulberg’s internal control. If the audit team adopts Chandler’s report, they will violate the principle of integrity. 4.0 Conclusion As an accountant, the level of sufficiency and appropriateness of audit evidence impacts the value of

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