Examination-3
Ethics and Professionalism in Accounting
ACCT 411
Spring 2015
Student: _____________________________
Date: __________________
Administrative Notes:
· This is an open book exam and you may use your ebook, anything posted in our LEO classroom, and relevant outside sources. Please properly cite all non-original statements.
· Attach your completed exam in your assignment folder in LEO.
· For each question, and where applicable, please apply the ethical principles and theories covered during the semester
· Late submissions will not be accepted.
This exam is to be completed without the assistance of any other person.
You may use only the resources approved by your instructor for this class.
I pledge on my honor that I have not given or received any unauthorized assistance on this examination. In addition, I pledge that I will not disclose to, or discuss the contents of this examination with, students who have not taken it. (You may type your full name if you are unable to sign and scan this cover sheet)
_________________________________________________________________________
Signed
Page 1
1. Integrity is said to be the backbone of ethical behavior. How does the integrity requirement of CPAs affect the performance of professional services by: (a) a controller of a corporation and (2) the internal auditor of a company and (3) the external auditor? Describe a situation where each professional’s integrity may be challenged.
2. On January 16, 2008, the SEC charged two former employees of PricewaterhouseCoopers LLP with insider trading. According to the SEC’s complaint, Gregory B. Raben, a former PwC auditor, and William Patrick Borchard, a former senior associate in PwC’s Transaction Services Group, used their access to sensitive information about PwC’s clients to allow Raben to buy stock ahead of a series of corporate takeovers. According to the complaint, Raben netted trading profits of more than $20,000 by buying stock ahead of public announcements disclosing the acquisitions and then selling his shares. Is there anything wrong with a CPA using insider information? Evaluate the actions of Raben and Borchard from an ethical perspective.
3. Explain the advantages and disadvantages of establishing one set of accounting standards (IFRS) to be followed by all companies around the world.
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