Unit: Summarize and Present Information in a Meaningful Way
February 14, 2021
What is globalization?
February 14, 2021

Professional Ethics for the Accountant

Read Major Case Study 3: MicroStrategy, Inc. on page 556 of your text. (Text book: Mintz, S. M., & Morris, R. E. (2014). Ethical obligations and decision making in accounting: Text and cases(3rd ed.). New York, NY: McGraw Hill Education.)

In six to eight pages, supported by evidence from your text and from other research (at least two resources are required), answer the following questions:

  • Evaluate the accounting decisions made by MicroStrategy from an earnings management perspective. What was the company trying to accomplish through the use of these accounting techniques? How did its decisions lead the company down the proverbial “ethical slippery slope?”
  • What motivated MicroStrategy and its management to engage in this fraud? Use the pressure and incentive side of the fraud triangle to help in answering the question. How would you characterize the company’s actions in this regard with respect to ethical behavior, including a consideration of Kohlberg’s stages of moral development?
  • Why is independence considered to be the bedrock of auditor responsibilities? Do you believe PwC and its professionals violated independence requirements in the AICPA Code of Professional Conduct? Why or why not? Include in your discussion any threats to independence that existed.

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