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CASE 7.2

Sarah Russell, Staff Accountant

Sarah Russell grew up in a small town in the flatlands of western Kansas where she
was born.1 In high school, she was homecoming queen, valedictorian of her graduat-
ing class, point guard on her basketball team for two years, and a candy striper (vol-
unteer) at the local hospital. Since her parents had attended the University of Kansas,
Sarah was off to Lawrence at age 18.
After spending her freshman year posting straight A’s in 30 hours of college courses,
Sarah settled on accounting as her major after seriously considering journalism, pre-
law, and finance. Although Sarah had yet to take any courses in accounting, she had
been impressed by a presentation that a female partner of a large accounting firm had
made at a career fair. Sarah was excited by the challenges and opportunities presented
by public accounting, as described by the partner. Here was a field in which she could
learn a great deal in a short period of time and advance rapidly to a position where
she had important responsibilities. Plus, public accounting provided a wide range of
career paths. If she really enjoyed public accounting, she could pursue a partnership
position with a large accounting firm. Then again, she might “hang out her shingle”
in her hometown, see the world on the internal audit staff of a large corporation, or
return to college after a couple of years of real-world experience to earn an MBA.
Sarah completed the tough accounting courses at the University of Kansas with
only two small blemishes on her transcript—B’s in individual and corporate taxa-
tion. During the fall semester of her senior year, Sarah accepted a position as a staff
accountant with a Big Four accounting firm. Sarah considered staying in her home
state but decided instead to request an assignment in her new employer’s Chicago
office. She believed that exposure to big-city life would allow her to arrive at a more
informed decision when it was time to make a long-term commitment to a career
path and a lifestyle.
During her first year on the job, Sarah served on six audit engagements. Her clients
included a pipeline company, a religious foundation, and a professional sports team.
She worked hard on those assignments and earned impressive performance apprais-
als from each of her immediate supervisors. Somehow Sarah also squeezed a CPA
review course into her hectic schedule that first year. And she was glad she did. She
was among the few rookies in her large office to pass each section of the CPA exam
on her first attempt. With that barrier out of the way, Sarah focused her energy on
being promoted to audit senior as quickly as possible.
Several individuals provided Sarah with much-needed moral support during her
first year, including R. J. Bell, an audit partner. Bell was 40 years old and had been a
partner for eight years. According to the office grapevine, he was in line to become
the new office managing partner within the next year or so. Bell tried to get to know
the new staff accountants assigned to the audit staff and to help them adjust to their
jobs in any way he could. Several times during the year, Bell invited small groups of
staff accountants to his home to have dinner with him and his family. Recognizing

1.  This case was authored by Carol Knapp, an assistant professor at the University of Oklahoma. This
case is based upon experiences related by a young woman previously employed by a large accounting
firm. The names of the individuals involved in this case and other background facts, such as locations,
have been changed.

439
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440 SECTION SEVEN Professional Issues

that Sarah was new to Chicago, he made a special effort to include her in such social
gatherings and to give her complimentary tickets to cultural and sporting events.
When Sarah’s old car from college died, Bell arranged for her to obtain a loan from
a local bank. Sarah appreciated Bell’s help and guidance. She considered the firm to
be very lucky to have an audit partner so supportive of staff accountants.
Shortly after her first anniversary with the firm, Sarah received a telephone call
from Bell at home one Saturday afternoon. At first, Sarah thought there must be a
client emergency that required her assistance, but Bell did not bring up any client
business during the conversation. Instead, he told Sarah that he had just called to
chat. Sarah felt mildly uncomfortable with the situation but spoke with Bell for a few
minutes before making up an excuse to get off the phone.
The following day, Sarah, an avid jogger, had just completed a four-mile run on her
regular jogging trail in a city park when Bell pulled up as she was walking toward her
car. “Hi, Sarah. How was your run?” Bell asked nonchalantly. “I was just driving by
and thought you might like to get a Coke after your workout.”
As Sarah approached Bell’s car she felt awkward but tried to act natural, as if his
unexpected appearance was only a coincidence. “Thanks, R. J. But I really need to
get back to my apartment. I’ve got several errands to run and phone calls to make.”
“You sure? I’m buying.”
“Yeah, I’d better get home.”
“Well, okay.”
Over the next several weeks, Bell made a concerted effort to develop a personal
relationship with Sarah. Eventually, Bell, who was known for working long hours,
was calling her nearly every evening from his office just “to chat.” Once or twice per
week, he invited her to get a drink with him after work. On a couple of occasions, she
accepted, hoping that by doing so he would stop asking her. No such luck. Finally,
she began avoiding him in the office and stopped answering her home phone when
she thought it was him calling. Twice, Bell dropped by her apartment in the eve-
ning. Panic-stricken both times, Sarah refused to answer the door, hoping he would
quickly decide that she was not home.
Bell’s persistence caused Sarah to feel increasing levels of stress and powerless-
ness. She did not know what to do or to whom she could turn. She was reluctant to
discuss the matter with her friends in the office since she did not want to start a rumor
mill. Embarrassment prevented her from discussing the matter with her parents or
other family members. Worst of all, Sarah began wondering whether she had some-
how encouraged Bell’s behavior. She racked her brain to recall each time that she
had spoken or met with him during her first year on the job. She could not remember
saying anything that could have been misconstrued by him. But maybe she had inad-
vertently said something that had given him the wrong impression. Maybe he had
mistaken the sense of respect and admiration she had for him as affection. Maybe
she had asked him an inappropriate question. Maybe . . .

EPILOGUE
After more than six weeks of enduring Bell’s
advances, Sarah summoned the courage to
make an appointment with him one Friday
afternoon in his office. When Sarah informed
Bell that she wanted to keep their relationship
on a strictly professional level, he failed to
respond for several tense moments. Finally, he
remarked that Sarah must have misinterpreted

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CASE 7.2 Sarah Russell, Staff Accountant 441

his actions over the past several weeks. He
was simply trying to make her feel more com-
fortable with her job. “I go out of my way to be
as friendly and sociable with as many mem-
bers of the audit staff as I can.” Bell then told
Sarah that, given the circumstances, he would
see to it that she was not assigned to any of his
engagements in the future. After another few
moments of tense silence, he tersely asked,
“Is there anything else I can do for you, Miss
Russell?” Sarah shook her head softly and then
got up and left his office.
Sarah had no further contact or conversations
with Bell following that Friday afternoon meet-
ing. A few months later, she decided to return to
Kansas to be closer to her family. At last report,
Sarah was the chief financial officer (CFO) of a
charitable organization.

Questions
1. In your opinion, how should Sarah have handled this matter? Identify the factors
that Sarah should have considered in dealing with the situation. Also, identify
the professional and personal responsibilities of Sarah, R. J. Bell, and other
relevant individuals in this matter.
2. What were the costs and potential costs to Sarah’s employer in this case?
How should accounting firms attempt to prevent these types of situations
from occurring? Assume that rather than speaking to Bell, Sarah had told the
office managing partner about the problem she faced. How should the office
managing partner have dealt with the matter?
3. This case took place several years ago. Do you believe that events similar to
those that took place in this case could occur now? Explain.

Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203