English Case Studies

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469.

sEcIoN SEVEN PnorEssloNal- lssuns

Despite the generally unpleasant opinions of F

irrto the Burnham audit with an open mind' He e izabeth, Anton had decided to go

ioyed public accounting and real-

i;zed that if he was to reach his goal of becomin an audit partner, he would occa-

sionally have to deal with "difficult" personalities. dit, Anton was wondering whY his

beth had been so kind in describ- impetuous," Elizabeth was obses-

By the end of his first week on the Burnham a

colleaques who had worked previously with Eliz

"blowing up" at Elizabeth. He understands that s

cloesn't believe that gives her the right to routine

ing hei. Instead of "detail-oriented," "stern," and

sive-compulsive, insensitive, and perpetually a

into the Burnham audit, Anton wonders if he can

berate and belittle him, including

in the presence of the other members of the auditengagement team. The onlY saving

ment. Elizabeth treats all of het ect and contempt.

Making matters worse is the fact that Elizabet is unreliable. At the beginning of

rkweek on the Burnham engage- it team would work ten-hour daYs,

the audit, she made it clear that the standard w

ment would be 60 hours. The members of the ite that mandate, Elizabeth often ppears during the daY for several

li a.m. to 7 p.m., Monday through Saturday' D

shows up for work at 10 a.m., and sometimes di

lfrours without telling Anton how he can reach er. On one occasion, Julius Shen

,:alled and asked for Elizabeth when she was n

;annoyed, if not exasperated, that Elizabeth had

nates how she could be contacted' Anton has gradually decided over the past few ks that the source

of Elizabeth's r, narnely, a drug Problem. During a close friend who had develoPed

an addiction to prescription drugs' He sees in Eli abeth many of the behavioral traits

and idiosyncrasies that he observed in that frien

In addition to her abrasive management styl

hours at a time, Elizabeth has random temper

or problem may spark her anger and cause he t her nearest subordinate. After herepisocles, Elizabeth typically directs her anger

tirade ends, she stomps out of the conference ro m and disappears for 30 minutes or

longer. When she returns, her emotions are und control and she goes back to work-

grace is that he is not being singled out for harsh

s;ubordinates on the Burnham audit team with di

disheveled and unkempt. On one occaslon, s

room wearing shoes that did not match'

unpleasant persona is a serious personal proble

.oil"g", he witnessed firsthand the unraveling o

ing as if nothing haPPened' Also very telling is Elizabeth's personal appea

woman and wears the latest business fashions

Julius Shen or Laura Bishop, the audit manag

ment, drops by to check on the status of the au

prepares for those Friday meetings by "over m

bft"n manic, overly effusive, and, most telling,

her other subordinates. Anton is so upset with Elizabeth that he just

unthinkable for him a few weeks earlier: he ca

meet and discuss Elizabeth's management sty

gry. Now that he is several weeks

make it to the sign-off date without

e is his immediate suPerior, but he

here to be found. Shen had been ot told Anton or her other subordi-

and her habit of disaPPearing for ntrums. Any small inconvenience to suddenly "lose it." During such

ance. She is a very attractive young but she sometimes arrives at work arrived at the client's conference

Ie to be civil with client personnel,

her contact with them, esPeciallY er best behavior on FridaYs when

r assigned to the Burnham engage- it. Anton is convinced that Elizabeth dicating" herself. On Fridays she is

he is almost "human" to Anton and

id something that would have been

led Julius Shen and asked that theY

Despite her "issues," Elizabeth is somehow a

although it is apparent to Anton that she minimi

with client executives. PIus, she is always on

e and overall demeanor. To Anton's

CASE 7.7 Elrz.q.sErH WalLacE, Auur SSNIoR

surprise, the audit partner did not seem the least bit annoyed b

arranged for the tw'o of them to have lunch today.

Fridoy Afternoon, JonuqrY l9 Elizabeth is livid. She is so distraught that she finds it almost i

centrate on the workpaper file that she is reviewing as she si

tion in the conference room shared by the members of the Burn

Earlier this morning, Julius Shen Came to the conference room'

d i s c u s s e c l t h e B u r : n h a m a u d i t f o r a n h o u r o r S o . J u l i u s e x p r e s s

h o w f a r b e h i n d s c h e d u l e t h e a u d i t i s a n d t o l d E l i z a b e t h t h a t s

will haveto begin working 70-hour weeks to complete the bulk

sign-off date. Elizabeth is not r-Lpset by the increased workload. What has upset

Julius toolk Anton Nikolov to lunch without inviting her. It was ob

that the traro of thern had made plans to go to lunch together. And, t

planned to exclude her. No doubt, the two of them had discusse

in fact. Elizabeth il; certain that Anton asked to go to lunch with Jt

ihey could talk about her privately. Ouut the past se'reral weeks, Elizabeth has grown increasingly di

He is like most of tlne light seniors or experienced staff accountants

ing a stirnLulant known as Adderall to help them pull "all-nighters"

exams. At one polnt, she tried to convince her family doctor to gi

tion for ttre drug brut he refused. So, she resorted to buying the d

friends wlho somehow had access to it. For the past eight years, she has been taking Adderall off and

But, she is conviil,ted that she doesn't have a "problem" with the

wants, sh,o cail quit taking it. Besides, in hgr mind, because Addera

drug, it has to be s;afe. Otherwise, doctors wouldn't prescribe it for

A f t e r k : a r n i n g t h a t s h e w a s b e i n g p a s s e d o v e r f o r p r o m o t i

E l i z a b e t h ' S a n g e r a n d l r u s t r a t i o n c a u s e d h e r t o b e c o m e d e p r

longtime friends l'rom her college days offered to give her a few

tion drug used to treat anxiety disorders and depression. Elizabe

up on the offer. It is amazing to Elizabeth how one of the pills c

spirits and help her cope with the dayto-day stress imposed on

and back.biting sr,rbordirtates such as Anton. Over the past sever become ia steady user of Xanax, although she has never bother

scription for it.

for her on previours engagements. He is self-centered and takes ry opportunity to

ingratiate himself to the audit engagement partner and audit mana

A few months algo, Elizabeth was passed over for promotion to udit manager, a

decision that had infuriated her. Everyone in her practice office k ows that the nor- She is convinced ave complained

mal time period for promotion to manager is five years with the firm

that she was not promoted because some of her subordinates about her in-your{ace management style. Elizabeth realizes that s

her subordinates, but she is convinced that pushing them to the li is demanding of

coddle them "toughens them up" and makes it more likely that th

the challenging work environment of public accounting. Elizabeth also suspects that some of her subordinates are rumo ngers. She sus-

pects thalt they arcl making up lies about her personal life, which i absolutely none iends began tak-of their biusiness. tn college, Elizabeth and a couple of her close

request and

possible to con- at her worksta- am audit team. he two of them d concern over e a n d h e r t e a m the audit by the

er is the fact that us to Elizabeth had obviously

her over lunch. ius alone so that

trustful of Anton. have worked

it and refusing to y will succeed in

before important her a prescrip-

g from friends of

o n . . . m o s t l y o n . rug. Anytime she I is a prescription

ir patients. n t h i s p a s t f a l l , s e d . O n e o f h e r

anax, a prescrlp- h took her friend n quic$y lift her

r by ungrateful months, she has to obtain a pre-

t ;

it

sEicrtoNsEVEN PRoresstoNallssues

Julius is iroubled. Earlier in the day, he went to I

Occasionally, Elizabeth.worries that the two d

e,ach other-quite often, she takes both of the dt

because they ire both prescription drugs, she re

if taken together.

Fridoy Evening, Jqnuqry l9 It is 7:25 p.m. on Friday evening and Julius Shen is

minutes earlier. he called his wife and told her tha

'ugs may somehow interact with

ugs on the same daY. But, again, ns that theY must be "safe" even

ill sitting at his office desk' A few

he would be heading home soon'

nch with Anton Nikolov, the new

voiced serious comPlaints about

izabeth Wallace. It is not the first

she serves as the lead senior for

nical comPetence, Elizabeth is

ng, thoroughlY documenting, and

cial statements. Just as important,

a client the benefit of the doubt

inancial reporting issue. She ada-

bers or iooselY aPPIY accounting rrific technician who exudes Pro-

rnantly refuses to allow clients to "fudge" their n

standards. In sum, she is an "auditor's auditor"' a

liessional skepticism. Despite her rechnicat skills, Eli zab eth, unf ortu rf ately, n": L' 1.?*19,"- :::ifi:

tH

d"-r";il'ffiffir*"ilsilil;;;;rch torfsher on her subordinares than she

is on her clients. On several occasions, Julius has counsg.led her during

ff::T:t-" appraisal sessions to be more considerate of her,zubordinates'

For whatever reason'

though, she always reverts back to her standar.d "drill

ii*lY:l"1ff19TJ^,,rr:r co^rp Julius had hoped that Elizabeth's iailur" t9 be promoted

to manager would serve

as a wake-up caii ior he, and make her realiz: !h."t :h9.lf :.i:::f:""#,?t:'Y,::rises' But, givenc r J G Y Y U I \ S - L I P \ - s r sonable approach to dealing with the individuals that

she super\

the statements of Anton Nikolov, Eiizabeth fras {bviously not changed

lt-lT-?:T:: ir,ui nirubeth has become even harsher with

her

audit senior assigned to the Burnham audit' Antg

hLis immediate supervisor on the engagement' E

time that Julius has heard such complaints' Julius is well acquainted with Elizabeth becau

the aud,its of two of his largest clients' In terms ot

unsurpassed. She has a special knack for identify

zrggressively investigating "hot spots" in client fina

Jlulius never has to worry about Elizabeth givin

rvhen it comes to a questionable accounting or

personally witnessed several telltale signs typice

iroubling to Julius is the fact that she sometimes

telling oih.t members of her audit team where

As an audit partner, Julius has faced many

doesn't relish that option because he and Elize

relationship. Unlike his other subordinates, EIi

other non-iob related issue with him' Another option is for Julius to refer the m

coordinator and take the risk that Elizabeth

subordinates. that Elizabeth maY have a serious

id not exPlain what he meant, Juiius

us audit engagement that Elizabeth

her subordinates had made a simi-

lar insinuation. Plus, in interacting with Eliza over the Past two Years, Julius has

e is or how theY can reach her'

whicli have involved complex auditing or acco

now, though, is even more stressful' He isn't st

essful circumstances, nearly all of

nting issues. The situation he faces

Elizabeth.-Sfroutd he confront her directly a th have exclusively a professional

beth has never shown anY interest

in "letting her guard down" and discussing her reer aspirations, private life, or any

ter to his office's human resources

Iy associated with drug abuse' Most

lisappears for several hours without

re exactlY how he should deal with

I speah to her as a "friend"? Julius

il} be removed from the Burnham

CASE 7.7 ELzaeETH WaI-L,q.cs, AuuIr SeNIoR

engagement, if not dismissed from the firm. That option is also unap her obvious shortcorfnings, Elizabeth makes his job much easier f Julius' 20 yeerrs of exp,erience in public accounting and the countless

ling. Despite h i m . I n s u m ,

cation seminars that lhe has taken over that time have not prepared hi this unpleasant and b'affling predicament.

tinuing edu- to deal with

Julius glanLces at hiis wristwatch one more time. Almost 30 minu have passed since he spoke with tris wife. It's time to go home. over the weekend, what to do about Elizabeth.

the purpose of identifying individuals who have substance abuse these firrns have a responsibility to help their employees address Defend your answ'ers.

Questions 1. Do you believe that Anton Nikolov has dealt with his concerns re rding

Elizabeth Wallace, appropriately? Did he behave ethically in discu matter with Julius Shen? Defend your answer.

ing that

2. How should Juliu:; respond to the matter involving Elizabeth? Idenlify the key factors that he should consider in deciding how to proceed.

3. Do public accounting firms have a responsibility to monitor their e ployees for

will decide

lems? Do problems?