Letting the Air Out of Independence Issues: Examining Aviary Corporation and Western Accounting Firm

Abstract

This case examines critical ethical accounting practice issues surrounding a request for proposal for audit services at Aviary Corporation based on a real Securities and Exchange Commission enforcement action. Audit and tax partners at Western Accounting Firm, a large international public accounting firm, used confidential information obtained from the company’s Chief Audit Officer to modify their proposal for audit services. In response to their actions, the Securities and Exchange Commission fined the auditing firm, the partners, and the Chief Audit Executive. The authors used publicly available information and adopted fictitious names to develop a teaching case that instructors can implement in a variety of accounting and ethics classes to increase students’ understanding of professional codes of conduct and independence guidance.

Citation

Hamrick, J., D. Byrd, J., Clark, A. and Kim, R. (2024), "Letting the Air Out of Independence Issues: Examining Aviary Corporation and Western Accounting Firm", Shawver, T.J. (Ed.) Research on Professional Responsibility and Ethics in Accounting (Research on Professional Responsibility and Ethics in Accounting, Vol. 26), Emerald Publishing Limited, Leeds, pp. 123-154. https://doi.org/10.1108/S1574-076520240000026006