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ACCA Strategic Professional · Strategic Business Reporting (International) · Professional and ethical behaviour in corporate reporting

Mateo, an accountant at Corvex Ltd, discovers the CFO has overstated revenue by recognising sales before control transferred. He raised it with the CFO, then the audit committee chair, and nothing changed. Which next step is MOST consistent with the IESBA Code?

After exhausting internal channels, Mateo should obtain confidential professional or legal advice and consider whether disclosure to an appropriate authority is legally permitted or required. Confidentiality has exceptions, but disclosure must be justified, so press leaks or unauthorised ledger changes are not appropriate.

  1. AConsider obtaining confidential advice from ACCA or legal counsel and then consider whether disclosure to an appropriate authority is legally permitted or requiredCorrect
  2. BLeak the information to the press immediately, since confidentiality never applies to misstatements
  3. CAccept the position because the audit committee has already reviewed it
  4. DAlter the revenue figures himself in the ledger without authority

Explanation

After internal escalation fails, the accountant should seek advice and consider legal rights and duties to disclose, and whether to resign. Confidentiality is not absolute but disclosure must be justified and lawful. Unauthorised ledger changes or press leaks are inappropriate.

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