The Moral Decision-Making Model in Auditing: A Seven-Step Process for Ethical Decision Making

The American Accounting Association (AAA) model provides a logical, seven-step process for decision making that takes ethical issues into account. This model, developed by Langenderfer and Rockness in 1990, is designed to help auditors make informed decisions that align with professional codes of ethics.

Step 1: Establish the Facts of the Case

The first step in this model is to establish the facts of the case. In the context of an auditor receiving a bribe offer, this would involve gathering all relevant information about the situation, including the amount and terms of the bribe.

Step 2: Identify the Ethical Issues in the Case

In the second step, the ethical issues in the case are identified. This involves examining the facts of the case and asking what ethical issues are at stake. In this example, the ethical issue is whether or not an auditor should accept a bribe.

Step 3: Identify the Norms, Principles, and Values Related to the Case

In this step, the norms, principles, and values related to the case are identified. This involves examining the facts of the case and asking what ethical issues are at stake. In this example, the relevant norms, principles, and values would include professional codes of ethics and social expectations.

Step 4: Identify Each Alternative Course of Action

In this step, each alternative course of action is identified. This may involve considering different options for responding to the bribe offer, such as accepting or rejecting it, reporting it to authorities, or ignoring it.

Step 5: Overlay the Norms, Principles, and Values on the Options

In this step, the norms, principles, and values identified in Step 3 are overlaid on the options identified in Step 4. This involves stating each option without considering the norms, principles, and values to ensure that each outcome is considered.

Step 6: Consider the Consequences of Each Option

In this step, the consequences of each option are considered. This may involve thinking about the potential outcomes of each course of action, including both positive and negative consequences.

Step 7: Make a Decision

Finally, in Step 7, a decision is made based on the analysis completed in previous steps. The decision should be made with full knowledge and recognition of each option's implications.

In conclusion, the moral decision-making model provides a structured approach to making ethical decisions in auditing. By following these seven steps, auditors can ensure that they are making informed decisions that align with professional codes of ethics and social expectations.

Moral decision making model