Dialogue Discussion - Period 1
Dialogue Post Week 1
The Case:
In a meeting between John Smith, a CPA and company controller, and Elias Best, the CFO, John is pressured to group 10 repair and maintenance expenditures, each under the company's $50,000 capitalization cutoff, into a single $500,000 fixed asset. Elias also suggests taking a $500,000 Section 179 depreciation deduction on the tax return, even though John knows the legal limit is now $25,000. John believes this would result in filing a false tax return and improperly increasing cash flow.
The Dialogue Question:
Exodus 20:16 states, "You shall not give false testimony against your neighbor." This commandment is a foundational principle of truthfulness and honesty. In the context of accounting, this extends to providing accurate and truthful financial information.
Considering the dilemma faced by John Smith, what philosophical and ethical reasoning is at play between the parties? Explain how the CFO’s actions, driven by a desire to manipulate financial statements and tax returns, directly violate the biblical principle of truthfulness. How does John's resistance to these actions reflect his commitment to honesty and integrity, and what advice would you give him based on the course materials and scripture?
Dialogue Post Week 2
The Case:
Juan, a CPA on an audit team, is under pressure to complete an audit quickly. He notices a discrepancy in the inventory count but his team votes to conceal this from their supervisor. A team member suggests reviewing fewer invoices to save time, and the team decides to under-report the actual hours spent on the audit to keep their supervisor happy. This situation presents a clear conflict between professional standards of due diligence and the internal pressure to meet deadlines.
The Dialogue Question:
In the parable of the talents (Matthew 25:14-30), Jesus commends the faithful servants who diligently managed their master's money, while rebuking the one who did nothing with it. This parable underscores the importance of being a diligent and faithful steward.
In the case of Juan and his audit team, explain how their actions, such as reducing the sample size and under-reporting hours, are a failure of due diligence. How does this behavior demonstrate a lack of faithful stewardship in their professional roles? Using Kohlberg’s stages of moral development, analyze what Juan should do, and explain how his decision to act diligently and truthfully, even against his team's wishes, aligns with the biblical principle of faithful stewardship.
Note: For each discussion period 2 Original posts. (200 words or fewer each). Each post must include a minimum of two academic references