The purpose of this case, loosely based on an actual auditor‐client situation, is to study decision making by auditors in public accounting firms regarding risk management (business, engagement, and audit risk), client continuance, and auditor independence. Audit partners often face difficult decisions for which they must balance the business objectives of the firm with their professional objective of satisfying the public interest. While most studies and cases focus on client‐acceptance decisions (e.g., Johnstone 2000; Gendron 2002; Knapp and Knapp 2004), an equally important decision for public accounting firms in the Sarbanes‐Oxley era is whether to keep a current client. This case encourages students to consider the decision with respect to client continuance, auditor independence, and risk evaluation.
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1 November 2006
Research Article|
November 01 2006
Decision Making in a Public Accounting Firm: An Instructional Case in Risk Evaluation, Client Continuance, and Auditor Independence within the Context of the Sarbanes‐Oxley Act of 2002
Ambrose Jones, III;
Ambrose Jones, III
Virginia Commonwealth University.
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Carolyn Strand Norman, Associate Professor
Carolyn Strand Norman, Associate Professor
Virginia Commonwealth University.
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Online Issn: 1558-7983
Print Issn: 0739-3172
American Accounting Association
2006
Issues in Accounting Education (2006) 21 (4): 431–447.
Citation
Ambrose Jones, Carolyn Strand Norman; Decision Making in a Public Accounting Firm: An Instructional Case in Risk Evaluation, Client Continuance, and Auditor Independence within the Context of the Sarbanes‐Oxley Act of 2002. Issues in Accounting Education 1 November 2006; 21 (4): 431–447. https://doi.org/10.2308/iace.2006.21.4.431
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