The Ethical Dilemma Of Susan Faces

1500 Words Dec 7th, 2015 6 Pages
9. (Discussed with Luhua Li, equally contributed)
1) The ethical dilemma Susan faces is that if she accepts the CEO’s request, she would violate the AICPA Code of Professional Conduct and the law so she might eventually lose her license or go to jail. On the other hand, if she rejects the CEO’s request, she might get marginalized or even fired, losing the ability to supply her kids.

2) By increasing net income in the manner Derek suggested, Derek would benefit in terms of gaining a substantial bonus and likely a new yacht, Susan and I might benefit in terms of maintaining our jobs and likely getting promoted. On the other hand, other stakeholders such as stockholders, vendors and suppliers, creditors, and investors might be harmed as a result of making wrong decisions by relying on the fraudulent financial statements.

3) There are a few alternatives that are available to Susan: a) accepts the CEO’s request and increase net income as suggested; b) rejects the CEO’s request and act in accordance with the rules and law; c) convinces the CEO that it is in his best interest to act in accordance with the rules and law; and d) reports the conversations to the audit committee.

4) By complying with Derek’s request, Susan could maintain her job, get promoted, and gain monetary compensations. On the other hand, she violates the AICPA Code of Professional Conduct, damages her personal and professional reputation, risks losing her CPA license and going to jail, and sets a bad…
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