Choose only case 1 or case 2 and respond to the following (as per 3-51 in textbook) Set forth arguments indicating that the firm's independence has not been impaired Set forth arguments indicating that the firm's independence has been impaired Express your personal opinion (there is no right or wrong response). Identify those arguments from above that your found most persuasive. If you believe that the firm's independence has been impaired, make suggestions about how the problem might be resolved. LO 3-4 sion make suggestions ab 3-51. The International Bank of Commerce (IBC) is an audit client of your public accounting firm. IBC is a multinational financial institution that operates in 23 countries. During the current year's audit, you have discovered the following problems: a. Improper loans were made to stockholders and other related parties. b. Loans were recorded on the books that appear to be either false or deceitful. You are especially concerned about these findings because it appears that members of senior management were aware of, and participated in these illegal activities. In accordance with professional standards, you have communicated these illegal acts to IBC's audit commit- tee of the board of directors. However, you are not satisfied with the committee's reaction to the situation. The chair of the audit committee thanked you cordially, but the committee took no action to investigate the activities or prevent their occurrence in the future. a. Describe the consequences if you immediately communicated these matters directly to the SEC. b. Describe your appropriate course of action in this situation. c. Present arguments for and against requiring auditors to report illegal acts directly to regu- latory agencies. quired