1

REQUIRED: Your audit team has been charged with evaluating the Hamilton Company Case. In doing so, the
partner on the engagement would like you to apply your understanding of the case and KPMG Judgment
Framework (including the potental for judgment traps to affect proper judgment application) to consider how the
audit process failed in this case and how the judgment framework could have been used to make the audit process
more effective in this case. To address the partners request, please write a well-thought out and supported memo
addressing the following questions. There is no minimum/maximum page requirement, but you should aim for a
memo that effectively communicates your thoughts to each question (part) below in a clear and concise manner.
Take special note of proper grammer, flow, and presentation as you prepare your memo. The memo will be worth
80pts in total.
PART 1

PART 2
You have been introduced several types of common psychological biases that may impair effective judgment
making by auditors (i.e. overconfidence, availability, confirmation, anchoring, group-think, rush to solve). In
your opinion, what bias or biases is/are to most likely have manifested in the Hamilton Case example? Provide
support for your answer.