You are the CFO of Clarke Company, which is publicly traded. At the annual shareholders’ meeting, you discussed the company’s recently reported results. As part of your presentation, you illustrated the minimum and maximum values for net income that Clarke could have reported using a range of accounting assumptions other companies in your industry use. Your statement prompted a cry of outrage from one of the shareholders present at the meeting, who accused you of being an unprincipled liar. This shareholder stated that any suggestion that there is a range of possible net income values for a given company in a given year indicates an overly liberal approach to financial reporting. This shareholder has moved that your employment contract be immediately terminated because of an apparent lack of moral character. The shareholder’s arguments have been persuasive to a large number of people at the meeting. What can you say to defend yourself?
-
You are the CFO of Clarke Company, which is publicly traded. At the annual shareholders’ meeting, you discussed the company’s recently reported results. As part of your presentation, you illustrated the minimum and maximum values for net income that Clarke could have reported using a range of accounting assumptions other companies in your industry use. Your statement prompted a cry of outrage from one of the shareholders present at the meeting, who accused you of being an unprincipled liar. This shareholder stated that any suggestion that there is a range of possible net income values for a given company in a given year indicates an overly liberal approach to financial reporting. This shareholder has moved that your employment contract be immediately terminated because of an apparent lack of moral character. The shareholder’s arguments have been persuasive to a large number of people at the meeting.
-
What can you say to defend yourself?
Shareholders represents the right of ownership to the organisation.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
