Thandi, a Chartered Accountant and partner at a medium-sized accounting firm in
Johannesburg, South Africa, faces a challenging situation. For several years, her firm
has audited a large construction company, SuperFix. Thandi recently discovered
discrepancies in SuperFix's financial records, indicating potential fraud and
mismanagement. The issues are significant, and Thandi must decide how to proceed.
SuperFix is a significant client, and the audit fees contribute substantially to Thandi's
firm's revenue. Thandi's brother, Themba, is a Senior Manager at SuperFix, and she
is close to her family. Thandi is respected in her field for her expertise and integrity
and is a member of the South African Institute of Chartered Accountants (SAICA).
REQUIRED:
2.1. Identify and analyse the relevant personal, business, and professional ethical
dilemmas apparent in the scenario.
(10 marks)
2.2. Evaluate the impact of these ethical dilemmas on the ethical values involved.
(10 marks)
2.3. Identify four (4) stakeholders affected by this situation and describe how they
are impacted by the ethical dilemmas apparent in the scenario.
(8 marks)
2.4. Briefly discuss the consequences if the following actions are taken against the
unethical behaviour:
2.4.1. Thandi reports fraud and mismanagement to the relevant authorities
(e.g., SAICA, regulatory bodies).
(3 marks)
2.4.2. Thandi ignores the fraud and mismanagement and continues with the
audit.
(3 marks)
2.4.3. Thandi resigns from the audit and cuts ties with SuperFix.
(3 marks)