Ethical Dilemmas in Auditing and Academic Integrity
This paper examines two interconnected ethical dilemmas drawn from the accounting profession and the academic setting. The first case analyzes a staff auditor (Johnny) who backdated and improperly inserted documents into audit work papers ahead of a Public Company Accounting Oversight Board (PCAOB) inspection, evaluating his conduct against the AICPA Integrity and Objectivity Rule and the standard of due professional care. The second case explores a student who used a restricted test bank as a study aid before a major accounting exam and then falsely signed an academic integrity certification. Both cases are assessed using professional accounting ethics frameworks, stakeholder impact analysis, and alternative courses of action, illustrating how ethical lapses in the classroom can foreshadow misconduct in professional practice.
- Introduction to Ethics in Accounting: Context for ethics in business and accounting
- The Staff Auditor Case: Overview: ABC Company audit work-paper insertion dilemma
- Analysis of the Staff Auditor's Ethical Violations: AICPA rule violations and stakeholder impacts
- The Student Academic Integrity Case: Overview: Student uses restricted test bank before exam
- Analysis of the Student's Ethical Violations: Integrity principle breach and institutional consequences
- Conclusion: Summary of both ethical lapses and principles
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What makes this paper effective
- It applies a consistent analytical framework — specifically the AICPA Code of Professional Conduct — to two distinct but thematically related cases, giving the paper coherence across its two parts.
- Each case follows a clear structure: case overview, rule identification, violation analysis, stakeholder impact, possible justifications, and recommended alternative action, making the argument easy to follow.
- The paper moves beyond simple rule-citation by explaining why specific actions violated standards, connecting procedural failures (e.g., missing dates and reasons) to their broader implications for audit credibility and institutional trust.
Key academic technique demonstrated
The paper demonstrates applied ethical analysis: it identifies a governing professional standard, maps specific behaviors onto that standard, weighs competing justifications, and proposes corrective alternatives. This is distinct from purely theoretical ethics writing because every claim is anchored to a concrete action taken by a named actor in a specific scenario.
Structure breakdown
The paper is organized into two self-contained case analyses, each containing an overview and a review section, followed by a brief conclusion. The introduction contextualizes both cases within the broader landscape of corporate responsibility and accounting ethics. This parallel structure allows readers to compare the professional and academic dimensions of ethical decision-making side by side.
Introduction to Ethics in Accounting
Corporate responsibility, accountability, and ethics have become some of the most critical issues in the business world (Nuseir & Ghandour, 2019). Business organizations are faced with numerous ethical issues relating to workplace safety, privacy threats, and legal liability. For business managers and management personnel, ensuring trust, honesty, and integrity is an essential step toward promoting ethical decision-making and practices in an organization. Given the complexities relating to ethics, business organizations face numerous issues and dilemmas requiring urgent attention.
This paper examines two such dilemmas. The first involves ABC Company, which faces an ethical dilemma related to an upcoming audit by the Public Company Accounting Oversight Board (PCAOB). The second involves a student in an accounting program who faces an ethical dilemma related to academic integrity. Both cases are analyzed using professional accounting ethics standards and frameworks.
The Staff Auditor Case: Overview
ABC Company is facing an ethical dilemma relating to the insertion and submission of missing revised work papers to PCAOB inspectors for auditing. While company policy requires the inclusion of a signed engagement letter for all audits, a copy was added prior to the inspection but without the actual date of insertion or reason for its addition (Cheng & Flasher, 2017). Prior to the addition of the letter, two key documents were missing from work papers that had been reviewed by the manager. The letter was included in the audit work papers to ensure they were complete and ready for PCAOB inspection.
Even though the missing documents were included to make the work papers complete, the manner in which they were added presents an ethical dilemma. The authenticity of the added documents is also questionable since they lacked an actual date of insertion or stated reasons for their inclusion. This implies that ABC Company is facing an ethical dilemma relating to the inclusion of missing documents in the work papers prepared for audit.
References
Association of International Certified Professional Accountants. (2016). AICPA Code of Professional Conduct. Retrieved September 6, 2021, from
Cheng, C. & Flasher, R. (2017). Two short case studies in staff auditor and student ethical decision making. Issues in Accounting Education, 33(1), 45–48.
Kassim, C.K.H.C.K., Nasir, N.E.M. & Ahmad, S. (2015). Academic dishonesty of accounting students at higher learning institutions. Mediterranean Journal of Social Sciences, 6(4), 702–707.
Nuseir, M.T. & Ghandour, A. (2019). Ethical issues in modern business management. International Journal of Procurement Management, 12(5), 592–605.
"Policy 150.25 – Academic Integrity." (2021). Academic Integrity Policy. Retrieved from university website: https://www.umgc.edu/administration/policies-and-reporting/policies/academic-affairs/academic-integrity.cfm
Public Company Accounting Oversight Board. (2021). AS 1015: Due professional care in the performance of work. Retrieved September 6, 2021, from
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