Accountants & auditors must follow the Rules of Professional Conduct. Read the mini-scenarios below and answer the following for each scenario: Part 1 - Identify which ethics rule or rule of professional conduct has been breached. Part 2 - Explain what the implication of this is - why is this a concern? A. The audit partner signed an unqualified (clean) audit report even though the audit team found a material misstatement (material error) in inventory during the fieldwork. B. The audit manager was working on an audit client that was in the process of merging with another company in its industry. The audit manager knew the stock would increase after the merger, so she told her spouse to purchase shares of the audit client today. C. You are working on an audit team that is auditing Loblaws Ltd. Last summer, part- time you worked on the IT team for Loblaws. Your part-time work included working on the design and implementation of IT software used in payroll processing. D. XYZ Company was shopping for an audit quote. In order to get more business, your audit company agreed to reduce the audit fee by 50% if XYZ Company continued to use the company as auditors for the next 5 years. E. You are a new audit company and in order to increase your business you post an ad on Craig's list - "50% off audit services" - "same quality service at half the price". F. You are working on an audit team that is auditing Sears Ltd. During the summer, you worked part-time as an accountant for Sears. Your part-time work included posting some journal entries in Accounts Receivable sub-ledger. G. You have been working long overtime hours at the audit client location. As part of a reward for you hard work the audit client provides you and your spouse with tickets to watch the Maple Leafs