Reference no: EM132170267

Scenario

Shyma the ebullient young graduate was taken up her career as junior auditor at Green, Thresher & Co. The first audit assigned for her with Emmie, Sara and Rahma ( staff -level employees) at Fantastic Fashions LLC. The audit is carried out under the supervision of Ahmed, an experienced auditor.

During the audit, Rahma, a member of the group, points out that she identified a shortage of inventory value in the client's inventory system that she did not verify during the physical inspection of inventory. She further admitted that the deficiency discovered will not make any major impact on the final audit report.

Shyma suggested Rahma to inform about the deficiency in inventory to Ahmed, the senior in charge of the engagement. Rahma is reluctant to approach Ahmed, as Rahma was the one who is supposed to identify the deficiency in inventory during the physical verifications of inventory, which she had failed to do so. Therefore, she felt that by informing Ahmed at this later stage of audit will provide a negative impact on her performance evaluation. The other two staff members of the audit team also agree with Rahma's decision of not to inform the supervisor.

However, Shyma does not agree with the group decision. She suspects what will be the cause if Ahmed gets to know about this deficiency later?

If the deficiency is material enough to create a huge impact on the audited financial statement? She raises all these question with her colleagues Emmie, Sara and Rahma, but the staff members stick to their stand of not reporting to Ahmed by reminding Shyma that the team is already behind on deadline given for audit. Further they emphasize that Ahmed will not be happy in spending additional time or to exceed the budget to repeat the physical inventory verification.

Assume you are in Shyma's position, resolve the ethical dilemma using GVV techniques

You should clearly discuss the following steps
- Identification
- Purpose & Choice
- Stakeholder Analysis
- Powerful Response
- Scripting & Coaching

Word count: Maximum 750 words