Question
Liona is the managing partner of Ross and Associates, a small audit firm. Liona's role includes managing the business affairs of the firm, and she
Liona is the managing partner of Ross and Associates, a small audit firm. Liona's role includes managing the business affairs of the firm, and she is very worried about the amount of fees outstanding from audit clients. One client, Broomers Pty Ltd, has not paid its audit fees for two years despite numerous discussions between Liona, the audit partner, Ball, and the management of Broomers Pty Ltd. Broomers Pty Ltd's management promised the fees would be paid before the audit report for this year was issued. Liona rang Ball this morning to ensure that the audit report was not issued because Broomers Pty Ltd had paid only 10 per cent of the outstanding account. She discovers that Ball is about to sign the audit report.
Required Explain the ethical problem in this case. Why is it a problem? What can be done about it?
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