another company who wants to buy Teejan too, but they are not aware that it is Majan Company. They also don't know that you were Majan's previous auditor. You are aware of Majan's problems and you know it will help them to recover profits if Majan will be the one to acquire Teejan Company instead of Home Depot. Which ethical principles will be least affected in this situation.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Assume that you are an independent auditor who
runs your own auditing firm. Majan Company was
your client last year who engage another
independent auditor this current year because of
some independence issues with your firm. Last
year, you know that Majan Company was having
less profit because of competition with a newly
established company ·
the Teejan Company which
--
is now selling their business. Because of this
reason, Majan wants to offer to buy Teejan. Two
months ago, Home Depot Company became your
new client. Home Depot Company's managing
director came to you to discuss that they intend to
buy Teejan Company. They know that there is
another company who wants to buy Teejan too, but
they are not aware that it is Majan Company. They
also don't know that you were Majan's previous
auditor. You are aware of Majan's problems and
you know it will help them to recover profits if
Majan will be the one to acquire Teejan Company
instead of Home Depot. Which ethical principles
will be least affected in this situation.
a. Integrity
b. Professional Competence
c. Confidentiality
d. Objectivity
Transcribed Image Text:Assume that you are an independent auditor who runs your own auditing firm. Majan Company was your client last year who engage another independent auditor this current year because of some independence issues with your firm. Last year, you know that Majan Company was having less profit because of competition with a newly established company · the Teejan Company which -- is now selling their business. Because of this reason, Majan wants to offer to buy Teejan. Two months ago, Home Depot Company became your new client. Home Depot Company's managing director came to you to discuss that they intend to buy Teejan Company. They know that there is another company who wants to buy Teejan too, but they are not aware that it is Majan Company. They also don't know that you were Majan's previous auditor. You are aware of Majan's problems and you know it will help them to recover profits if Majan will be the one to acquire Teejan Company instead of Home Depot. Which ethical principles will be least affected in this situation. a. Integrity b. Professional Competence c. Confidentiality d. Objectivity
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