QUESTION 27 3 points Save Answer Please answer the questions following the short case below. Crystal Staudt worked for a small accounting firm located in northern Michigan. Crystal, her husband, and their two children loved the area and began to establish roots in the community. After working for the firm for six months, Crystal was assigned to conduct an annual audit of a machinery manufacturer. During her audit, she found that the firm had received a large loan from the local savings and loan association. It was illegal at that time for savings and loan associations to lend money to a manufacturing firm; they were restricted by law to mortgages based upon residential real estate. It also occurred to Crystal that the president of the savings and loan association, who made the loan, was also the largest owner of the manufacturing company, which received the loan. She was a wealthy, powerful person in the community and had referred a number of people to the small accounting firm where Crystal worked. Crystal took her working papers and a copy of the ledger showing the loan to her boss, Emilio Posa--the partner in charge of the office. Emilio listened to Crystal, and then told her: I will take care of this privately. We simply cannot afford to lose a client of this status. You put the papers you have through the shredder. Crystal was astonished. The AICPA (professional) code of ethics and the generally accepted auditing standards both require that an auditor either resign from the engagement or issue an adverse opinion when one finds irregularities during an audit. The amount of the loan was substantial. Crystal's reporting of her discovery would adversely affect the savings and loan association. Crystal hesitated when hearing her boss' orders. Emilio spoke again: I will not tell you again. You put those papers through the shredder or I'll guarantee that you'll never get a C.P.A. in Michigan, or work in an accounting office in this state for the rest of your life. Give a Stage 2 reason Crystal should shred the papers. (1 point)