Module 14 Ethics Activity Discussion
Discussion Instructions
To complete this discussion, you must make an initial post responding to the ethical dilemma questions. Please address all the questions in full and cite your sources. Secondly, you must respond to another student's post in which you further the discussion. Start by reflecting on the original post. You may ask further questions, comment on the strength of their reply, address information that is missing, or provide examples that correspond with the topic. Agreement with the initial response is not required, but responses should reflect be supported with analogies, examples, research, or content from the text. All students should respectful of differences of opinions.
Ethics Discussion
As the controller of a medium-sized financial services company, you take pride in the accounting and internal control systems you have developed for the company. You and your staff have kept up with changes in the accounting industry and been diligent in updating the systems to meet new accounting standards. Your outside auditor, which has been reviewing the company’s books for 15 years, routinely complimented you on your thorough procedures.
The passage of the Sarbanes-Oxley Act, with its emphasis on testing internal control systems, initiated several changes. You have studied the law and made adjustments to ensure you comply with the regulations, even though it has created additional work. Your auditors, however, have chosen to interpret SOX very aggressively—too much so, in your opinion. The auditors have recommended that you make costly improvements to your systems and also enlarged the scope of the audit process, raising their fees. When you question the partner in charge, he explains that the complexity of the law means that it is open to interpretation and it is better to err on the side of caution than risk noncompliance. You are not pleased with this answer, as you believe that your company is in compliance with SOX, and consider changing auditors.
Using a web search tool, locate articles about this topic and then write responses to the following questions. Be sure to support your arguments and cite your sources.
Ethical Dilemma: Should you change auditors because your current one is too stringent in applying the Sarbanes-Oxley Act? What other steps could you take to resolve this situation?
Related Chapter Outcomes and Course Goals
This group assignment addresses the following course goals:- Explain accounting and financial management including planning, budgeting, resource allocation, and sources of funding.
- Illustrate why financial reports and accounting information are important, and identify who uses them.
- Describe the six steps in the accounting cycle.
- Identify major trends affecting the accounting industry today.
Grade Value and Rubric
This discussion activity is worth 15 points.The course discussion rubric is applied to this discussion