The audit of KBC Solutions by Carlson and Smith, CPAs, was scheduled to end on February 28, 2019. However, Rick Carlson was uncertain whether it could happen. As the review partner, he had just completed going over the work paper files of the senior auditor in charge of the engagement, Grace Sloan, and had way too many questions to wrap things up by the end of the week. Rick called Grace into his office and asked her about some questionable judgments she had made. He hoped her explanations would be satisfactory and he could move on with completing the audit. Why did you approve the accounting for new acquisitions of plant and equipment that were not supported by adequate underlying documentation? Why did you accept the client’s determinations of accrued expenses rather than make your own independent judgments? How can you justify relying on last year’s work papers to determine the proper allowance for uncollectibles one year later? To say Grace was stressed out would be an understatement. This was her first engagement as a senior and she wondered whether it would be her last. Grace knew she had to make a convincing case for her judgments or suffer the consequences. She responded to each point as follows. The client had problems with their systems and had to contact the vendor for a duplicate copy of the relevant invoices. She expects the copy within two days. The client seemed to have a reasonable basis for those judgments so she saw no reason to delay completion of the audit over the accrued expenses. Although the confirmation rate on the receivables was slightly below expected norms, there was no reason not to accept the client’s explanation for those not confirmed as being correct in amount and due date. Grace knew her answers would not completely satisfy Rick. She did, however, believe there were extenuating circumstances she felt compelled to explain even though it might reflect negatively on her leadership abilities. She explained that the audit team pressured her to let certain matters go because they were behind schedule in completion of the audit. She was convinced by the majority to trust the client on outstanding issues, which included the three raised by Rick. Rick was not very happy with the explanation. He wondered about the professional judgments exercised by Grace and what her future with the firm should be. Question: Does Rick have any ethical obligations in this matter? What should he do about signing off on the audit and why?