Ethics Cases

 

Rules governing the investment practices of individual certified public accountants prohibit them from investing in the stock of a company that their firm audits. The Securities and Exchange Commission (SEC) became concerned that some accountants were violating this rule. In response to an SEC investigation, PricewaterhouseCoopers (PwC) fired 10 people and spent $25 million educating employees about the investment rules and installing an investment tracking system.

Instructions

Answer the following questions.

 

a. Why do you think rules exist that restrict auditors from investing in companies that are audited by their firms?

b. Some accountants argue that they should be allowed to invest in a company’s stock as long as they themselves aren’t involved in working on the company’s audit or consulting. What do you think of this idea?

c. Today, a very high percentage of publicly traded companies are audited by only four very large public accounting firms. These firms also do a high percentage of the consulting work that is done for publicly traded companies. How does this fact complicate the decision regarding whether CPAs should be allowed to invest in companies audited by their firm?

d. Suppose you were a CPA and you had invested in IBM when IBM was not one of your firm’s clients. Two years later, after IBM’s stock price had fallen considerably, your firm won the IBM audit contract. You will be involved in working with the IBM audit. You know that your firm’s rules require that you sell your shares immediately. If you do sell immediately, you will sustain a large loss. Do you think this is fair? What would you do?

e. Why do you think PwC took such extreme steps in response to the SEC investigation?

Sample Solution

Additionally, teachers have evaded the idea due to an absence of motivation, the pressure to advance test results (Liu and Szabo, 2009) and inadequate knowledge of how to integrate ICT into the curriculum (Honan, 2008). This ‘inadequate knowledge’ displays that students are not always getting the full benefits of ICT in education even though it has been recognised to influence students learning (Finkenberg et al, 2005) and affect the development and progression of students regarding their holistic growth. The iPad can act as a facilitator towards developing the different domains if integrated correctly, if not then the central area being affected can be the Social and Emotional Aspects of Learning within the (SEAL) programme. The SEAL Programme advocates that for schools that want to engage fully in the application of plans designed to promote and develop social and emotional learning, they recommend that resources and time are made accessible to the staff to permit them to do so (DfE, 2010). The application of the SEAL programme would then be reliant on the culture of the school as the incorporating of technology into education depends on the perception and vision of the school rather than the teacher (Plomp et al, 2007). The students’ progress will be impacted as it is down to the availability and support of technology in schools have an effect on the technology integration efforts made by teachers (Fu, 2013) which is a drawback as if teachers are provided with adequate and reliable access to hardware/software and sufficient technical support, they can be more productive (Chen, 2010).

Supplementary to this, there is a rhetoric of how ICT can be used and how it is used within education and that promises/expectations of widening participation, increased motivation and better levels of attainment is exaggerated (Selwyn, 2014). There is substantial research which suggests that technology in education can increase pupil motivation (Zach et al, 2016). Nonetheless, this conflicts with the view of Henderson and Yeow (2012) who identify the issue of the iPad creating distractions as students are so used to accessing social media on phones or computers that when faced with an iPad they can become inevitably distracted and find themselves on applications and websites they should not be accessing.

This question has been answered.

Get Answer
WeCreativez WhatsApp Support
Our customer support team is here to answer your questions. Ask us anything!
👋 Hi, Welcome to Compliant Papers.