Question
Recent legislation requires CEOs of public corporations to sign an affidavit, a sworn statement,stating that all accountings put forth by the company are accurate and
Recent legislation requires CEOs of public corporations to sign an affidavit, a sworn statement,stating that all accountings put forth by the company are accurate and not misleading; not to the best of their knowledge, but that they are accurate and not misleading.Obviously, the CEO of most public corporations can't personally perform all aspects of these accountings. Instead, they must rely on the accuracy of employees assigned to perform such tasks at various levels. The legislation makes the CEOpersonallyliable, even criminally liable,for inaccurate accountings. Considering this, is it fair or equitable to find a CEO liable if a subordinate has committed fraud or a mistake in the preparation of the accounting?
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