Read and analyze the case study below.

$2.$ Write a memo to upper management with your recommendation for keeping the money and not

telling the subcontractor about the accounting error. Explain your reasoning for coming to this

conclusion in the write up$.$

$3.$ Write a memo to upper management with your recommendation for telling the subcontractor

about the accounting error and passing the money on to them. Explain your reasoning for coming

to this conclusion in the write up$.$

$4.$ Tell me which one of these approaches you think is most appropriate and discuss why.

CASE STUDY NO$.1$

As a general contractor, Conway Construction Corporation entered into written contract with

Setcher Roofing Company for all roofing, decking, and sheet metal on the Bentonville High

School for a contract amount of $$261,000.$

This was one of several contracts that CCC had with Setcher and was one of many contracts over

a period of years prior to this contract. During the course of the job there were three change

orders for additional work; one for $$1,060$; one for $$2,380$ and one for $$21,540.$ All change

orders were approved by the architects and paid by the owners. During the course of the job,

CCC received and paid several monthly estimates which included the base contract on two of the

smaller change orders for some reason unknown to CCC$,$ Setcher failed to acknowledge the

$$21,540$ change order or invoice CCC for same. The work covered in the change order was,

however, completed on schedule as per plans and specs.

Some five months later after an internal audit by CCC$,$ it was called to top management$$s

attention that Setcher had signed all lien releases and gave CCC a paid in full receipt back some

four months ago.

The ethical question asked was, do we keep quiet and hope Setcher & Company never finds out

that they were not paid for the $$21,540$ change order, or do we pay as per our contract

provisions