BECSR ASSIGNMENT

1.What responsibilities did David Duncan owe to Arthur Andersen? To

Enron’s management? To Enron’s stockholders? To the accounting
profession? Explain.
David Duncan had been Arthur Andersen's former partner for 20 years, and had been the lead
partner of the company on the Enron account. He was later fired from Andersen in 2002 and
charged with obstruction of justice for ordering Andersen's personnel to shred over a ton of
Enron-related papers.
Duncan had obligations to all of the mentioned parties and he failed in due diligence, was
accused of behaving carelessly and displayed utter lack of integrity in his association with
Enron. As the head auditor, Duncan was responsible for maintaining the highest professional
accounting and auditing ethics, and leading the audit team responsibly and impartially.
Duncan as well as all auditors must retain an impartial approach and they must also keep a
healthy measure of cynicism, recognizing that there might be deception and errors, but not
evaluating without the supporting proof that may come from a thorough audit, which is
another aspect that Duncan has never provided.
He was accountable for supplying his client, Arthur Andersen, with the finest technical
support he could provide. Duncan also had a duty to the management of Enron which was to
perform a comprehensive, secure audit. Auditors don't audit corporations to the company's
advantage; they audit companies to stakeholders 'benefit.
He also had the responsibility of providing clean report to shareholders, which should have
revealed that the stockholders lost revenue. It was really significant enough, as Enron failed,
to affect the industry and the economy. When Duncan had intervened, that may have been
mitigated sooner.
David's duty to the accounting profession was governed by ethical standards upholding of
integrity and reliability. In fact, it was the auditor's duty to preserve a decent picture of the
accounting practice.

2.Evaluate the conduct of the relationship manager(s) with reference to

standard code of ethical conduct.
Each entity, particularly the partnership bankers, are required to perform their company in
compliance with the highest ethical principles to achieve and retain the full faith and
confidence of their clients and the public in general. In this situation, though, bank
relationship managers participated in disreputable activities that culminated in the bank itself
being in conflict of interest.
This methodology incorporates four frameworks of ethical reasoning — rights and
responsibilities, utilitarianism, fairness, and justice approach — in a system that lets
administrators and representatives navigate into a cycle of critical thinking to figure out the
ethical aspects of a complex and potentially contradictory situation.
Utilitarian approach:
Another method of thinking about a philosophical dilemma is to use utilitarian evaluation to
consider the greater value with the maximum number. That method of cost-benefit is a very
popular approach to strategy, although as the concept implies, it might not be an appropriate
justification for making an ethical action in a moral dispute by itself.
Right approach:
Rights are justifiable representations or entitlements that allow persons to follow their own
desires, often based on legislation or other authoritative documents, such as agreements and
foreign declarations. Rights may be defined as the good stuff individuals are entitled to do,
but they often come together with an obverse aspect, in the form of responsibilities or
commitments that go alongside the privileges. The relationship manager would also have
expanded the Probability of the capital spent in comparison to the positive gain.
Justice approach:
Justice values represent a third direction in which executives should think for ethical choices.
Just judgments involve justice, equality and neutrality on the part of judgment-makers,
especially with regard to the ultimate burdens and benefits that the judgment may carry.
Because of certain commissionable strategies with big yields and high risk, the fund manager
will describe both forms of investing. He should encourage Suchitra Krishnamoorthi to select
her investment according to her risk tolerance, rather than offering his opinion.