Question
Fatima Hassan is responsible for the work of compilation, review, and audit clients for Doha CPA firm. She has been assigned a new client, Al-Wajbah
Fatima Hassan is responsible for the work of compilation, review, and audit clients for Doha CPA firm. She has been assigned a new client, Al-Wajbah Consultation Services Corporation that recently engaged with the firm. The CEO, Ali Mahmoud, makes all major decisions, monitors the operational activities of Al-Wajbah Consultation Services Corporation. This Corporation has not previously used the services of a CPA firm. In addition to the preparation of financial statements, Doha CPA firm will handle tax returns for the corporation. At her first visit to the clients office, Fatima Hassan is introduced to Hala Abdulla, a new bookkeeper who is also an accounting student in her final year at a local university. At a subsequent meeting, Hala confides to Fatima that she found the job at the beginning of the semester after an extensive search. Hala really needs the money to help finance her education and feels lucky to have found a good-paying job during the current economic downturn due to the COVID-19 pandemic. Feeling that Fatima is someone she can talk to and get advice from, Hala describes a situation that has been on her mind for some time now. Halas concern relates to the handling of sales revenue. When the proceeds from sales are counted and deposited on a weekly basis, a report is filled out with categories carefully delineating the type of payment: cash, checks, or credit cards. After depositing the weekly total, Ali brings this report back with his own written-in total of the actual amount deposited. After looking over some of these weekly deposits, Hala noticed that 20,000 QR cash was missing from each deposit. After a more thorough inspection of monthly tax documents that Ali has filled out, Hala noticed that the reported monthly gross revenue was 80,000 QR less than what had been actually counted. Ali is the only person handling the money after it has been counted. He is also the only one to deposit the money. When Hala asked Mr. Ali about revenue not being reported, he answered that this is done for tax purposes. He thinks that the auditor will accept this action because Doha CPA firms fees for performing the audit and other tax services are paid by Al-Wajbah Consultation Services Corporation.
: You should answer the following questions:
1. What is/are the ethical issue(s) in the case? Why each is considered an ethical case?
2. Who are the primary stakeholders influenced in the case, explain how?
3. What are the possible alternatives for Hala Abdulla, Fatema Hassan, and Ali Mahmoud?
4. For each alternative above in (Q3), do the net benefits exceed the net costs to all primary stakeholders? Provide your explanations
5. Whose rights are violated in each possible alternative above in (Q3)? Provide your explanations
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