Case 3.1 – A Day in the Life of Brent Dorsey, Staff Auditor Professional Pressures
1. What alternatives are available to Brent in regards to the audit of payables? What are the pros and cons of each alternative?
- Brent could refuse to work the extra hours – Pros: Brent will improve his strained relationship with his wife and remain morally correct by not reporting dishonest working hours on the engagement. Cons: Brent could cause the engagement to come in over budget, which will make John look bad and could cost John his management promotion. Brent may also receive a less positive evaluation by John after the engagement is over, this could hold him back from future promotions with the company which will affect his income and ability to provide for his growing family. He may later be terminated over the refusal if John can find a reason to let him go.
- Work the extra hours and “eat the time” – Pros: Brent will please John by helping the team meet budget requirements on the engagement, which will lead to favorable evaluations. This will help his future in the firm and his earnings potential for supporting his growing family. Cons: Working the extra hours will further strain relations with his wife, and could even end his marriage eventually, as it leads to more engagements with overtime in the future. He will be acting unethically by reporting dishonest hours.
- Pull only 20 instead of 30 invoices – Pros: Could save enough time that they might honestly come in under the time budget, thereby avoiding the need to be dishonest with recording hours worked. Cons: Still requires working the extra hours and harming relations with his wife. More importantly, this violates several Codes of Conduct rules (discussed below) that expose the firm and the auditors to liability.
- Work the extra hours and charge the time to the engagement – Pros: Follows orders by working the extra hours while still remaining ethical and honest in reporting correct hours worked. Cons: Hurts the engagement budget by recording the extra hours, which may hurt his future with the firm as stated above. Will also further strain the marriage as also discussed above.
- Report Scott’s request to the John – Pros: Allows Brent to remain ethical by getting assistance from superiors as to what he should do in the situation; he would not have to make the decision by himself. Cons: He will certainly anger Scott by reporting him, which may harm his future because Brent may be viewed as a tattletale by coworkers. This will strain working conditions in the future. Brent may still be ordered by John or other managers to work the hours and be dishonest anyway and could still be faced with the same dilemma.
- Quit this engagement – Pros: Will allow Brent to go home and improve relations with his wife as discussed above. Also allows him to avoid the ethical dilemma of whether to work the extra hours and whether to report the honest or dishonest number worked. Cons: May only be postponing the dilemma until the next engagement with John Peters, when he may make a similar request again. May also cause John to give him a bad evaluation due to quitting the engagement and appearing to be a poor team player.
- Quit the firm – Pros: Will allow Brent to seek employment at a firm that is more ethically aligned with his own beliefs, that will not make these types of requests of him. He could find a firm with less overtime that may help his marriage problems as well. Cons: He may have a hard time finding a new job, which would lead to financial troubles at a time when his family is expecting a baby. This will certainly cause more marital strife at home. He could also find another firm that requires just as much overtime, or end up at one that pays less. “The grass is not always greener on the other side.” A significant possibility for him to consider is that there may be many firms practicing “eating time” and he may also find...
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