please answer the case study questions? the subject is business ethics .

128 0 Business Ethics REAL-TIME ETHICAL DILEMMA I was employed as a certified public answer the FDIC examiners by stat- accountant (CPA) for a regional ac- ing that, during our audit, we made counting firm that specialized in au- dits of financial institutions and had `copies of two checks made payable to an executive of the bank for $8,000 many local clients. My responsibili each. ties included supervising staff, col- The COO stated that during his lecting evidence to support financial review of the audit work papers he statement assertions, and compil- had not found any copies of checks ing work papers for managers and made payable to executives. He also partners to review. During the audit stated that a better response to the of a publicly traded bank, I discov- question regarding the checks would ered that senior bank executives were be, "I was not aware of reviewing under investigation by the FDIC for any checks specifically made pay- removing funds from the bank. They able to the executive in question. were also believed to be using bank The COO then said that the exam- funds to pay corporate credit card iners would be in the following day bills for gas and spouses' expenses. to speak with the audit staff. I was The last allegation noted that the dismissed from the meeting. executives were issuing loans to rela- Neither the CEO nor the COO tives without proper collateral. asked me if the suggested "better" re- After reviewing the work papers, sponse was the response I would give, I found two checks made payable to and I did not volunteer the informa- one executive of the bank that were tion. During the interview, the FDIC selected during a cash count from investigators never asked me whether two tellers. There was no indication I knew about the checks. Should I based on our sampling that expenses have volunteered this information? were being paid for spouses. My au- dit manager and the chief financial Questions officer (CFO) of my firm were aware 1. What would you have done? of these problems. Volunteered the information After the fieldwork for the audit or stayed silent? Explain your was completed, I was called into the decision. CEO's office. The CEO and the chief 2. Was anything unethical going operating officer (COO) stated that on in this case? Explain. the FDIC examiners wanted to in- 3. Describe the "ethics" of the officers of the firm in this case. terview the audit manager, two staff accountants, and me. The CEO then 4. What, if anything, should the officers have done, and why? asked the following question: "If 5. What lessons, if any, can you you were asked by the FDIC about take from this case, as an em- a check or checks made payable to bank executives, how would you ployee working under company officials who have more power answer?" I told them that I would than you do