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ACCA Applied Knowledge · Business and Technology · Regulation and financial crime

An accountant at Marlow Ltd discovers that a director is falsifying expense claims. She reports it to the audit committee chair instead of her line manager, who is the director's friend. Which statement best describes the benefit of this route?

Reporting to the audit committee chair gives access to someone independent of the people involved, so the concern is less likely to be suppressed because of a conflict of interest. It does not guarantee dismissal, and it does not remove the need for a formal whistleblowing policy.

  1. AIt lets the matter be raised with someone independent of the people involvedCorrect
  2. BIt guarantees that the director will be dismissed
  3. CIt removes the need for the company to have a whistleblowing policy

Explanation

An independent route such as the audit committee chair avoids conflicts of interest where the line manager may suppress the report. It does not guarantee any outcome, and a policy remains good governance practice.

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