Ann McMillan Is a CPA with a Public Accounting Firm

question 13

Multiple Choice

Ann McMillan is a CPA with a public accounting firm. A client of Ann's has called to tell her that the SEC is investigating the company for possible misrepresentations in the company's financial reports. Ann is worried that she may have pushed the envelope in allowing some of the revenues of the client to be reported as they were. Ann shreds several sets of notes from her meetings with the client on revenue recognition. Ann:

• A)is probably guilty of obstruction of justice.
• B)has done nothing wrong because the notes are privileged communication the SEC is not entitled to have.
• C)has not committed obstruction of justice because the SEC has not contacted her.
• D)None of the above

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Definitions:

CFO

Chief Financial Officer, the senior executive responsible for managing the financial actions of a company.

Purely Cash Compensation

Payment made in the form of physical currency or through direct deposit to a bank account, without any non-cash benefits.

Company Takeover

The acquisition of one company by another, where the acquiring company assumes control of the target company.

Proxy Fight

A contest between two or more parties to win control over a company by convincing other shareholders to vote for one side's preferred corporate governance changes.