Auditing And Accounting Cases: Investigating Issues Of Fraud And Professional Ethics

Auditing and Accounting Cases Investigating Issues of Fraud and Professional Ethics Third Edition Dr. Jay C. Thibodeau Deborah Freier AUDITING AND ACCOUNTING CASES, THIRD EDITION Published by McGraw-Hill, a business unit of The McGraw-Hill Companies, Inc., 1221 Avenue of the Americas, New York, NY 10020. Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved. Previous editions © 2009 and 2007. No part of this publication may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system, without the prior written consent of The McGraw-Hill Companies, Inc., including, but not limited to, in any network or other electronic storage or transmission, or broadcast for distance learning. Some ancillaries, including electronic and print components, may not be available to customers outside the United States. This book is printed on acid-free paper. 1 2 3 4 5 6 7 8 9 0 DOC/DOC 1 0 9 8 7 6 5 4 3 2 1 0 ISBN 978-0-07-811081-8 MHID 0-07-811081-5 Vice President & Editor-in-Chief: Brent Gordon Vice President, EDP/Central Publishing Services: Kimberly Meriwether David Editorial Director: Stewart Mattson Publisher: Tim Vertovec Senior Sponsoring Editor: Richard T. Hercher, Jr. Marketing Manager: Dean Karampelas Editorial Coordinator: Rebecca Mann Senior Project Manager: Lisa A. Bruflodt Design Coordinator: Margarite Reynolds Production Supervisor: Nicole Baumgartner Media Project Manager: Balaji Sundararaman Compositor: Laserwords Private Limited Typeface: 10/12 Palatino Printer: R. R. Donnelley All credits appearing on page or at the end of the book are considered to be an extension of the copyright page. Library of Congress Cataloging-in-Publication Data Thibodeau, Jay C. Auditing and accounting cases : investigating issues of fraud and professional ethics / Jay C. Thibodeau, Deborah Freier. — 3rd ed. p. cm. Rev. ed. of: Auditing after Sarbanes-Oxley. 2nd ed. c2009. ISBN-13: 978-0-07-811081-8 (alk. paper) ISBN-10: 0-07-811081-5 1. Corporations—Accounting—Corrupt practices—United States—Case studies. 2. Corporations—United States—Auditing—Case studies. 3. Corporations—Moral and ethical aspects—United States—Case studies. 4. Professional ethics—United States—Case studies. 5. United States. Sarbanes-Oxley Act of 2002. I. Freier, Deborah. II. Thibodeau, Jay C. Auditing after Sarbanes-Oxley. III. Title. HF5686.C7T48 2011 657'.450973--dc22 2009054311 www.mhhe.com This book is dedicated to Ellen, my extraordinary wife of 20 years, and my children, Jenny, Eric, and Jessica. You have all provided the inspiration for me to undertake and complete this project. I could not have accomplished it without your love. Thank you. This book is also dedicated to the loving memory of my father, Jacques Thibodeau, who inspired me to reach for the stars. Thank you. Jay C. Thibodeau I dedicate this book in loving memory of my father, Martin Freier, who inspired me to work hard and to strive for excellence. He also inspired me and others with his strength, his integrity, his dedication to family and friends, his desire to help others, his deep abiding love for learning, his wide array of talents and interests, and his appreciation for life. He was a great man and will truly be missed. This book is also dedicated to Matt, who always believed in me and was a constant source of support. Deborah Freier About the Authors Dr. Jay C. Thibodeau, CPA Dr. Thibodeau is a Professor of Accountancy at Bentley University. He received his B.S. degree from the University of Connecticut in December 1987 and his Ph.D. from the University of Connecticut in August 1996. He joined the faculty at Bentley in September of 1996 and has worked there ever since. During his sabbatical in the fall semester of 2003, Jay worked with PricewaterhouseCoopers’ Learning & Education group to help deliver critical knowledge about the