Professional Judgement Framework
Student’s Name
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Critically evaluate the judgments made by Grace as the senior by using the KPMG Professional Judgment Framework.
Grace judgements were not a timely partner and manager involvement. This is because her response was not timely, and she did not consult the manager before concurring or reaching an agreement with the partner (Bucaro, 2019). Since in KPMG auditing, all the specialist are required to get involved in the process; then, it was not good for Grace to not consult her manager before making the decisions that she made.
She did not access the right knowledge before making her judgements. Grace did not make her own verified judgment based on her critical thinking, but she depended on the partner’s decision. That is why she told her manager that the client seemed to have a reasonable basis for those judgements. This is against the professional judgement framework since she was supposed to reason about her judgement before completion of the audit.
The judgement made by Grace was not based on the ongoing mentoring, supervision and review. In the making of her judgement, Grace did not rely on the papers from the reviews of the past year. She only made her judgement based on her own understanding and experience. More so, since she was new in the company, it would be better for her to engage the specialists who were in the company for years to get a clear view of how the company operates.
She did not make a critical assessment of all audit evidence obtained during the audit. Since she was quick in making her judgment, Grace did not obtain all the evidence that was needed to assess the audit before making the judgment critically. She quickly accepted the client’s claim about the system problems which, according to the professional judgment framework is a rash decision to be made by a senior officer in a company.
Lastly, she did not manage and document the audit. According to the case study, the manager seems to be furious about Grace’s decision that she made without documentation. In the first question, the manager asks her why she approved accounting acquisitions without any supporting documentation details.
Did Grace violate any rules of conduct in the AICPA Code? Explain.
Yes. Grace broke the AICPA code in that she did not apply integrity in her judgement. This is seen where she makes her judgment without involving the specialists and the manager who play major roles in any company. She was required to make inquiries from these individuals to approve her judgement before making a final decision (Jenkins, Popova & Sheldon, 2018). More so, she did not make documentation which is a terrible decision since the accounting documentation is a crucial part in every company because of any future misunderstandings such documents are always used as the references.
Moreover, she broke the code by not allowing the other specialists in the company to do their responsibility. Grace made her judgement without anyone’s help; this was against the code rules. She was supposed to involve all the others in the judgement and not only listen to the client’s problems.
References
Bucaro, A. C. (2019). Enhancing auditors’ critical thinking in audits of complex estimates. Accounting, Organizations and Society, 73, 35-49.
Jenkins, J. G., Popova, V., & Sheldon, M. D. (2018). In support of public or private interests? An examination of sanctions imposed under the AICPA code of professional conduct. Journal of Business Ethics, 152(2), 523-549.