ACCT Ethic Midterm Examination

Carefully read the questions below and provide your written response. 

Please note this examination is to be completed by each student individually.  Sharing answers and or posting this exam on any Website for any purpose is a violation of school Policy 150.25.  All professors are required to turn students in to the Dean's office if they suspect academic dishonesty.

Be sure your answers are well reasoned, conclusions are well supported, and your writing is well organized with few, if any, spelling/grammatical errors. Use spell and grammar check.  Remember the 3-C's of writing: correct, clear, and concise.   All professors have access to TurnItIn.com and may submit student papers to test for plagiarism.

Questions:

1. A shift toward greater accountability and professional responsibility has taken place over the past twenty years.  In your own words, discuss some of the issues that may have caused this shift in the accounting profession.

2. In your own words, discuss your understanding of the differences among the terms, ethics, morals, and laws.

3. Define professional skepticism and explain how it is helpful for accountants, particularly auditors and tax preparers.

4. In your own words, discuss how the AICPA's Code of Professional Conduct assists accountants' in making ethical professional judgments.  Be specific.

5. In your own words, discuss how responsibility, accountability, fairness, and transparency help to create ethical corporate governance systems.

6. Select any two provisions of the AICPA Code of Professional Conduct and in your own words, explain how they contribute to maintaining high ethical standards in the accounting profession.

7. In your own words, discuss the difference between ethical rights and obligations in the accounting profession.

8. Supreme Justice Warren Burger, wrote the following opinion in the case: United States v. Arthur Young & Co: "By certifying the public reports that collectively depict a corporation's financial status, the independent auditor assumes a public responsibility transcending any employment responsibility with the client.  The independent public accountant performing this special function owes ultimate allegiance to the corporation's creditors' and stockholders, as well as to the investing public.  This "public watchdog" function demands that the accountant maintain total independence from the client at all times and requires complete fidelity to the public trust."

How does the auditor's public responsibility transcend his/her employment responsibility with the client?

9. While you are engaged in the audit, the client asks if you would like to be the company's guest for a weekend in New York City.  Discuss specific professional codes of ethics that specifically provide guidance on how the auditor should respond.

10. In your own words, discuss ethical relativism from an objective perspective.  In addition, then state and justify your opinion of the theory of relativism.