You are the Director of Tax Accounting and Reporting for a major public company. Accounting has just closed the books for year end and passed on all information to the tax department to complete the final journal entry for the annual financial statements. After nearly four weeks of working an average of 100 hours/week, the entire tax department has finally finished. The journal entries have been prepared, reviewed, re-reviewed, and reviewed once more. All sign offs have been obtained by leadership and Directors from other areas of the department. Just before midnight, three days before the company releases its earnings to investors, the tax entry is submitted to accounting and a collective sigh of relief comes over the entire department. Its time to go home and relax and spend time with your friends and family, whom you have sorely missed. After arriving home around 1am you receive a text message from your boss. The message reads as follows: We have a problem. Your mind scrambles. Oh no, what could it be. You immediate thought goes to a position your company took this quarter largely based on your own advice. The company was debating on taking a position that would recharacterize certain types of foreign earned income, the result of which would reduce your tax expense by a significant amount, nearly $4 cents of earnings per share to company investors. However, after weeks of analysis and consultation with each of the department heads and outside counsel (BIG 4 AUDIT FIRMS) your company decided to take the position, but only recorded 50% of the benefit due to uncertainty on how the taxing authorities would view this strategy. The 50% conclusion was reached solely based on estimates and was signed off by your audit firm as reasonable. Although the idea stemmed from your brain, after careful analysis and discussion you eventually disagreed with the position and argued not to record any benefit out of belief the authorities would never agree with such a strategy. However, your leadership and audit form felt comfortable enough with a partial benefit. After calling your boss from the driveway to your house, you learn there is a meeting in the morning that you are required to be at. Only few details were provided. You go inside and clean yourself up, trying hard not to wake up the rest of the household. You lay down and get a few hours of rest. And then you wake up and get ready to head to work for a mandatory meeting. When you arrive, all Directors enter your boss large office and gather around the desk. Your boss explains that after booking the final tax entry she received a call from accounting and finance indicating the company had missed earnings per share expectations by $2 cents, meaning two whole pennies. Historically missing guidance has led to immediate drops in the company stock price. The Accounting and Finance teams asked if there was anything in the tax numbers that were estimates that may need to be reevaluated, or perhaps an error was made somewhere that needed to be re-investigated. After explaining this conversation, she asks each of the Directors to go back to their teams and ask them to dig back into their work from the past three weeks and see if there is anything that may need to be reviewed further, and perhaps even updated. In response to this request two Directors become visibly upset. They each express their concerns about the request; that asking their employees to continue working on something they busted their butts to complete, and reviewed, and re-reviewed, and reviewed again, seemed to be a fruitless request, not to mention the discomfort with the motivations behind it. One Director asked outwardly, If we find an error that makes it even worse (meaning we would miss investor expectations by a larger amount), should we report those errors as well, or just the ones that help us? After the dust settles and the arguments die down with no agreement, your boss looks to the back of the office and sees you standing against the wall with your hands behind your back, as if handcuffed to the building. And she asks you directly, Youve been awfully quiet. This is your area; this is your team. What do you think?

YOUR TASK IS TO TELL ME HOW YOU WOULD RESPOND.