Gabby Has Just Left a Meeting with the Partner in Charge

question 58

Multiple Choice

Gabby has just left a meeting with the partner in charge of an audit engagement and was told to ignore the typical year-end accrual entries because earnings are below financial analysts' earnings expectations. Gabby knows this is wrong and wants to act on her values but she does not want to lose her job. What is the best thing for Gabby to do in this situation if she chooses to voice her values?

• A) Quit the firm
• B) Speak with the managing partner of the firm
• C) Inform the SEC of the difference
• D) All of the above

---

Definitions:

Duty To Defend

The duty to defend entails a legal obligation, often found in insurance policies, where the insurer must provide legal defense to the insured party in case of a lawsuit that falls under the policy coverage.

Compensatory Damages

Monetary awards issued to a plaintiff to compensate for actual losses, injuries, or damages they have incurred.

Liability Case

A legal dispute or lawsuit in which the plaintiff seeks damages from the defendant due to injury or loss caused by the defendant’s actions or negligence.

Increase Of Hazard Clause

A provision in insurance policies allowing the insurer to void the policy if the risk insured against significantly increases.