CASE 5.6
RYDEN TRUCKING, INC.
Synopsis
An all too common problem that business owners face is dealing with dishonest employees. This
case examines this problem in a public accounting context. A staff accountant of a Seattle-based
accounting firm embezzled more than $30,000 from one of her employer’s clients. After she was
“nailed” for the theft, the young lady confessed to the crime. At that point, she insisted that she had
needed the stolen funds to pay the mounting medical expenses of her terminally ill mother. The
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Ryden Trucking, Inc.—Key Facts
1. In August 2009, Jermell Marshall, the managing partner of a small accounting firm in the Seattle
area, hired Lola Rojas, a 28-year-old accountant who had recently moved to Seattle from
southern California.
3. Rojas told Marshall that she had stolen the funds so that she could pay the large medical
expenses of her terminally ill mother.
5. Rojas, who was fired by Marshall, repaid the embezzled funds to Ryden a few weeks after her
confession—she told Marshall that a relative had loaned her the money to reimburse the client.
7. Less than one month later, Rojas was charged with having embezzled $41,000 from her new
employer.
8. An insurance company sued Marshall to recover the $41,000 that it paid to reimburse Rojas’s
10. Despite that ruling, an appellate judge noted that Marshall may have had a moral obligation to
inform Rojas’s new employer of her previous indiscretion.
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Instructional Objectives
1. To examine the moral and ethical obligations that accounting firms have to their employees, their
clients, and to third parties who may be affected by the decisions that they make.
Suggestions for Use
A secondary or peripheral feature of this case, which is raised by Question 1, typically produces
the most heated “give and take” among students when the case is covered in class. That feature is
the allegation by Lola Rojas that she needed the $32,000 she embezzled to pay for medical expenses
for her terminally ill mother. A related issue is her claim that there would be no one to care for her
Suggested Solutions to Case Questions
1. Again, as pointed out in the “Suggestions for Use,” the ethical dilemma faced by Lola Rojas
provides an opportunity for students to explore the boundaries and latent dimensions of ethical (and
2. There are several factors or combinations of factors that may have motivated Marshall to
intercede so persistently and generously on Rojas’s behalf. For example, he almost certainly felt
some degree of sympathy for her given the plight she apparently faced. That sympathy was probably
enhanced by the fact that she had been a good employee for his firm and was well liked by peers and
client personnel alike. Another possibility is that Marshall was naïve and was “snowed” by Rojas’s
charming personality.
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3. Professional standards require “assistants” assigned to audit engagements to be “properly
supervised.” In this context, “proper supervision” refers to, among other activities, providing
subordinates with appropriate instructions regarding the application of specific auditing procedures,
providing meaningful and candid answers to questions they pose, and reviewing their work and
pointing out errors and oversights they have made.
4. A legal obligation of an individual to act, or not act, in a given way generally stems from a
mandate imposed by a specific statute, by a common law precedent, or by some government–
imposed rule or regulation. On the other hand, a moral obligation to act, or not act, in a given way