The client also will incur another cost to appoint new auditor to audit their financial statements.
Is the decision legal?
According to the law and regulations, auditors have their duty to act honestly and it is their responsibility to give or express an opinion on the fairness of their client’s financial statements. Here, Ben and James resignation is due to their concern about the risk associated if they continue to serve Prairieland Bank and ignore the changing of some accounting policies made by the client’s management, which is illegal. If they continue to serve Prairieland Bank, they are deemed to disobey their responsibilities, which is wrong. Therefore, the decision made by James and Ben to resign is considered legal. Ben and James’s decision to resign is considered fair because they deserve to choose whether to resign or to continue serve the client. If they resign, they can maintain the firm’s credibility and reputation as auditors. While, Prairieland Bank will not actually take the greatest burden as it still can appoint a new auditor (Jack Lane) to audit its financial statements.
Is the decision fair?
Is the decision is the right
As auditors, Ben and James have the right choose whether to continue serve Prairieland Bank or to resign. Here, their decision is considered as
To resign or to serve thing to do? the right thing to do