Consequences of Telling the President of the Miscalculations
Reputation Damage: Telling the president about the gross miscalculations may damage your professional reputation, as it reflects negatively on your accuracy and attention to detail. The president may question your competence and trustworthiness in handling important financial projections.
Stock Price Decline: If the president has already made half of his speeches based on the overstated projections, revealing the miscalculations could lead to a decline in Fernetti’s stock price. Investors who relied on the projections to make investment decisions may lose confidence in the company, resulting in a potential decrease in stock sales and price.
Loss of Trust: The president may lose trust in your abilities and judgment if you inform him about the miscalculations. This could impact your working relationship and future opportunities within the company.
Consequences of Not Telling the President of the Miscalculations
Misleading Investors: By not disclosing the miscalculations, you are allowing the president to continue presenting inaccurate projections to investors. This can mislead investors into making investment decisions based on false information, potentially resulting in financial losses for them.
Legal and Regulatory Issues: Presenting false or misleading financial information can have legal and regulatory implications. If the inaccuracies are discovered later, Fernetti Conductor Inc. may face legal consequences, such as lawsuits or investigations by regulatory authorities.
Long-Term Reputational Damage: If the miscalculations are eventually discovered by investors or stakeholders, it could have severe long-term repercussions for both you and the company. Your professional reputation may be irreparably damaged, and Fernetti Conductor Inc. may face a loss of credibility, affecting its relationships with investors and business partners.
Ethical Considerations
Integrity: As an accountant, maintaining integrity is of utmost importance. It is essential to act truthfully and transparently when dealing with financial information. Disclosing the miscalculations to the president aligns with ethical principles of integrity and honesty.
Fiduciary Duty: As an accountant in a position of trust, you have a fiduciary duty to act in the best interests of the company and its stakeholders. By not informing the president of the miscalculations, you would be failing in your duty to provide accurate financial information.
Accountability: Being accountable for your actions is an ethical principle that should guide your decision-making. By informing the president about the miscalculations, you take responsibility for your error and ensure that corrective actions can be taken promptly.
In this situation, it is crucial to prioritize ethical considerations over potential short-term consequences. By informing the president about the miscalculations, you uphold professional integrity, protect stakeholders’ interests, and demonstrate accountability for your actions.
