Team Collapse at Richard, Wood, Hulme, LLP
James Michaels was a senior associate in the Richard, Wood, Hulme, LLP. He assisted with junior associates and co-op students with resolving questions in addition to completing his own audit work. He worked in a team to audit Spector's business in these years. In 2008, Michaels faced some problems: the audit started on November 3, 2008 and was supposed to be completed by November 19, 2008. The deadline was a strict one, but the audit was less than 50 percent finished by November 12, 2008.
Richard, Wood and Hulme LLP (RWH) was a mid-sized professional services firm that offered clients audit and taxation services. RWH's culture consists of teams by employees. All audits were completed by teams. Also, RWH's bid to become Spector's auditor in 2003, so Spector was an important client in its company. Spector is a residential real estate company which entered into construction loads that disbursed funds as needed to assist in managing the company's cash flow when it entered the condominium markets. Spector's year-end audit began in November 2008. The team members were consist of nine people:
Genna Wood: She was a founding partner of RWH. Wood was responsible to the firm and client for the overall completion of the audit and for signing the audit opinion.
Adam Nguyen and Keri Feldman: They were senior managers. Both were responsible for assisting Wood with client relations and reviewing audit engagement work.
Jody Ellis: She was a senior associate. She would report to senior managers on a daily basis. And, she was responsible for managing the senior and junior associates while accomplished her own audit work. However, she had a problem that she didn't pass the chartered accounting qualification exam.
Kira Dee and James Michaels: They were all senior associates. They're duty were the same with Ellis, excluding daily basis report. Dee had the same problem with Ellis.
Heather Goodman, Mariana Faust and Scott Ireland: They were junior associates. Their job completed own work efficiently and assisted senior associates. All three of them would take their first exam in 2008.
Adrian Noth, Arvind Patel and Caleb Oldman: They were co-op students. They primarily took direction from the senior associates and assisted in completing their work.
The Spector audit team had a good performance in 2007. However, they faced many problems in 2008.
Since the examination was only offered once a year, Ellis and others hoped they could go to fully study. RWH employed Emma Watson to assign the engagement plan. And, Watson hadn't completed the planning when she leaved. This situation affect that Ellis came back and finished planning too late and everyone hadn't time to review it.
Due to the global recession, Michaels thought that they would require additional testing to determine the valuation of assets. So, the workload was increased to the audit team.
Spector didn't provide the team with the relevant information as needed on time. The team was waiting three days to get information.
Dee wanted to complete her work at home, so did Noth and Patel. This event leaded Michaels found co-op students shirked work. It also made the team members blamed each other. Conflicts within the team started upgrade.
However, financial crisis influenced Spector, they wanted to revise some information. This forced Michaels to restart his work. Undoubtedly, this would increase workload. So, Michaels need additional staff to join in the team. The senior managers refused this suggestion.
Within the audit process, Ellis and Dee took their exam. However, they still failed. With the firm policy, they should leave the company. So, Michaels' team lacked two good associates. This news made others who will take the exam were consider their job security.
RWH's competitor - Alpha LLP wanted to poaching people and promised good remuneration. And, some of...
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