Topic: Leadership (Communication, Power, Motivation)

Characters: Bob, Managing Partner Jerry, Partner; Leandra, Stacy’s Supervisor Stacy, Junior Accountant The Psychologist

 

Stacy is a recently hired employee of a growing local CPA firm. The partners of this firm have high expectations for Stacy, mainly because he scored near the top of his graduating class. However, nothing seems to flow right for Stacy at this firm. He is asked to perform at an advanced level on some jobs because of heavy firm turnover at the senior level. As a result of his inexperience, Stacy does not meet time budgets and much of his work on tax returns has to be redone. These problems have compounded to the point where no one thinks he can do anything right. Near the end of his first year, he told by his Supervisor, Leandra, and the Managing Partner, Bob, that he is on six-month probation without a salary increase. Stacy is determined to prove that although he has the ability, he is simply improperly managed.

During the past few months, the firm has suffered continued resignations of staff accountants. After Stacy mistakenly charges the wrong client account for a tax return, Jerry, the Tax Partner, loudly reprimands him in front of his peers and tells him, “Next time it’s coming out of your paycheck.” Later that week, as Stacy is helping interview a candidate for one of the open accounting positions, he accidentally chips a glass table in the conference room with his Coke bottle. This time, Bob asks Stacy if his insurance policy will cover the table, and, if not, what he intends to do about it.

Not long afterwards, the accounting staff finds out that a psychologist is coming to the firm for the week to assess the turnover problem, employee morale, and overall firm productivity. All remaining workers, including Stacy, describe the poor treatment of employees and awful work environment. Not surprisingly, the resulting report from the consultant points toward numerous management problems at the company. Shortly thereafter, the partners take the response personally, and rumors surface that they have put the firm up for sale. Still, the interviews for staff positions continue. The partners have asked all those who are interviewing candidates to present the firm in a positive and favorable manner. Stacy doesn’t know what to tell potential new hires about the opportunities and working conditions at this firm.

Author: Curtis Jay Bonk, Ph.D., CPA, Assistant Professor of Educational Psychology, West Virginia University.

Co-author: Mary M. Bonk, CPA, Director of Financial Analysis, West Virginia University Hospitals, Inc.

What Are the Relevant Facts?

  1. Stacy is a new staff accountant at a local CPA firm.
  2. The CPA firm he works for has a lot of turnover, especially at the senior accountant level.
  3. A psychologist/consultant was brought in to assess employee morale and organizational issues.
  4. Other employees point out to the psychologist the same management problems that Stacy has encountered.
  5. Stacy feels that the firm’s partners have gone out of their way to point out his mistakes, especially since he has been required to take on higher-level assignments than his experience and training dictate.
  6. Stacy is on probation.
  7. Stacy is helping interview candidates for the open accounting positions.

What Are the Ethical Issues?

  1. Does Stacy have a duty of loyalty to the firm when interviewing prospective job candidates?
  2. Does Stacy have a duty to provide truthful information to candidates?

Who Are the Primary Stakeholders?

  • Partners of the CPA firm
  • Stacy
  • All other employees of the CPA firm
  • Prospective employees of the CPA firm
  • Clients

What Are the Possible Alternatives?

  1. Stacy can do as he has been told and present the firm in a positive and favorable manner.
  2. Stacy can be frank about the company with job candidates.
  3. Stacy can resign.

What Are the Ethics of the Alternatives?

  • Ask questions based on utilitarianism. For example:
  1. Which alternative produces the greatest good to the greatest number?
  2. How would costs and benefits be measured? Do the benefits of telling the truth outweigh the benefits to the firm of lying? What costs would Stacy incur if he told the truth?
  • Ask questions based on rights. For example:
  1. What rights does each stakeholder have?
  2. What right to truthful information does a job candidate have?
  • Ask questions based on fairness or justice. For example:
  1. Which alternative distributes the benefits and burdens most fairly?
  2. Is Stacy being asked to bear an unfair burden?

What Are the Practical Constraints?

  1. If Stacy informs all new hires about the problems at the firm, he might be reprimanded again or fired. In fact, frank communications may haunt him when seeking a future job reference.

What Actions Should Be Taken?

1. What actions should Stacy take

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