1.
During the course of an engagement, you and a junior consultant discover illegal payments, fraud and
other questionable management practices. The client is a largely held corporation. Shortly after the
discovery, the junior consultant makes the following comment: We’re here as confidential counselors
and have been made privy to innermost secrets by a client who has been completely open. What right
do we have to tell him what’s right and wrong? Do we have to be policemen as well as father confessors?
What response should you make to this comment?
As a consultant of a large company you have obligations to tell your clients that you have
discovered fraud and other questionable management practices occurring at their firm., I would
like to seek professional advice from the relevant professional body or legal counsel, and thus
obtain guidance on ethical issues. does not violate confidentiality. As a consultant I can
determine the appropriate course of action appropriate to their problems. I will tell my junior
consultant that we need to respect the confidentiality of what is happening in the organization. I
will also consult with those in charge of the organization’s management, such as the board of
directors or the audit committee.
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2. As a consultant, you are at a critical point in your review of the client’s financial control system. You
find the procedures clearly antiquated; and data going into the annual report include grounds for serious
challenges by a dissident stockholder. The trouble is that the president himself designed the system
while he was controller. He is bound to upset at what is more than occasional criticism of his work.
Volatile as he is, he might even persuade the board of directors to discharge you. This has been and will
continue to be an extremely profitable client. Should you tell it as it is or should you soft-pedal the
subject?
Since a qualification of a consultant is independence. In this case if it happens that the
independence of the consultant is compromised, then I suggest that he refrain from his work.
But if he has enough courage and is confident in himself that he can do his job right, he can as
long as he maintains a sense of integrity. The consultant should make an important
recommendation that will convince that his or her recommendation can benefit more than ever
before. Most all consultant should not finish the salary he can afford but above all he should
consider the service he can provide is effective. They are hired to make various
recommendations and it must be implemented in the company.
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3. Your firm has been invited by a hospital to perform a feasibility study concerning a new wing for the
hospital. Your firm has an outstanding reputation in this area, and the hospital feels that a positive
recommendation from your firm would help it sell the bonds to provide the needed financing. As you
discuss the engagement with the client, you become aware that the decision has already been made to
construct the new wing and that your study is being pursued merely as an attempt to help sell the
bonds. As you contemplate the study, you conclude these is only a 50 percent chance that the results
will show it to be economically desirable to pursue the expansion. However, a negative outcome would
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completely undermine any attempts to sell the bonds. The job is yours if you want it, and it would be a
very profitable contract. What should you do?
Because our firm has an outstanding reputation, we will not accept this engagement due to 50%
chance and negative outcome. We wouldn’t take the risk because in our study, a negative
outcome would result if we continued with it. Although this project is very profitable, the
reputation of our company depends on this project. There is only a likelihood that this project
will be successful is low. So our decision was not to pursue this engagement.
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4. You are the sole owner of your own management consulting practice; however, you have several
consultants who work for you on a full-time basis. Your firm’s specialty is marketing, and you have
developed an outstanding reputation for your ability to develop marketing programs that are successful.
One of the major tobacco manufacturers has recently offered you a very profitable consulting contract to
develop a marketing program for the southeastern portion of the Philippines. Personally, you do not
smoke and you feel it is wrong for other people to smoke. Is it ethical for you to accept the engagement,
feeling as you do?
In my opinion, it’s ok to be a consultant of a tobacco manufacturer, as long as I have do my work
especially in marketing and promoting this firm. I must not bring profession to a disgrace. .
Because according to the code of ethics for management consultants, consultants must prioritize
the interests of clients over personal interests and serve the client with integrity. Opinions about
smoking should be set aside. you must be professional when it comes to this situation.
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5. Wonder, Inc., engaged Ju & Grace, CPA’s, to assist in the installation of a new computerized production
system. Because the firm did not have experienced staff available for the engagement, Ju & Grace
assigned several newly hired staff assistants without sufficient supervision as a result, Wonder, Inc.
incurred significant losses when the production system crashed, causing significant backlogs and lost
product sales. Describe the possible legal implications of this situation for Ju & Grace.
Management should also have adequate knowledge of the engaged company. And they must
have a computer expert, either they’ll take it or themselves, to install a new Computerized
Production System. Management must also first determine the possible outcome before
accepting the engagement, either they are actually competent or they can handle the
engagement or they are not. And also assigned staff should always have adequate supervision,
especially newly hired. They should always remember that in every engagement the company’s
name is at stake if they are not well prepared.
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