Chapter 7 Fixed Assets, Naulai osu Case 7-6 Ethics and professional conduct in business The following is an excerpt from a conversation between the chief executive off Jenkins, and the chief financial officer, Steve Mueller, of Quatro Group Inc. officer, Kim Kim: Steve, as you know, the auditors are coming in to audit our yearend financial st pretty soon. Do you see any problems on the horizon? Steve: Well, you know about our "famous" Scher Company acquisition from a couple of year ago. We booked $9,000,000 of goodwill from that acquisition, and the accounting rules requite us to recognize any impairment of goodwill. Kim: Uh-oh. Steve: Yeah, right. We had to shut the old Scher Company operations down this year because those products were no longer selling. Thus, our auditor is going to insist that we write off the $9,000,000 of goodwill to reflect the impaired value. Kim: We can't have that-at least not this year! Do everything you can to push back on this one. We just can't take that kind of a hit this year. The most we could stand is $5,000,000. Steve, keep the write-off to $5,000,000 and promise anything in the future. Then we'll deal with that down the road. How should Steve respond to Kim