For each of the situations listed, identify which of three principles (integrity, objectivity and independence, or due care) from the AICPA Code of Professional Conduct is violated. Assume all persons listed in the situations are members of the AICPA. (Note: Refer to the AICPA Code of Professional Conduct contained on pages 25–27 in Chapter 1 for descriptions of the principles.)

a. April, a staff accountant for Rogers & Co., is confused by the process for estimating uncollectible-accounts expense using an aging schedule; she struggled with this topic when she was in her accounting program in college. When she is given the responsibility for reviewing the entries related to her company’s uncollectible-accounts expense and the aging schedule, she compares this period to the prior period and does not do any further review or analysis as is needed.

b. Will is on the audit staff of Monroe & Co, CPAs. He is assigned to the audit of Lafayette Holdings, a fast-growing technology firm that is run by his stepmother. He is excited to be assigned to this exciting audit because he feels it will help to advance his career. He does not disclose the relationship to anyone, nor does his stepmother.

c. Shana is the treasurer of Oxford Company. She knows that her company plans to keep its investment in Google stock for several years. (It has actually been pledged as collateral for a loan that Oxford has at a local bank.) However, she decides to classify the Google stock as a short-term security. Classifying the Google stock as a short-term security makes it a current asset and increases Oxford’s current ratio, making the company look more favorable to investors.

d. Conway Corporation has a large number of customers who buy on credit. Nick, the controller for Conway, deliberately underestimates the amount of uncollectible account expense this year so that the company’s income will achieve the targeted income figure. If the company’s income reaches or exceeds the target, monetary performance bonuses for all members of management, including Nick, will be awarded.