April 8, 2013
To: Gina Owens-Ricks
Date: April 8, 2013
Re: Financial Crisis
Tim Marvin, chief financial officer (CFO) has suddenly resigned amid rumors of inappropriate accounting practices. The U.S. Securities and Exchange Commission (SEC) is currently investigating the situation and the requested documentation is suggesting the crisis may involve revenue recognition. I have attached a press release I feel will meet the company’s requirement for public notice. As a publicly held company, we are required by the SEC to file about:
* Our operations;
* Our officers, directors, and certain shareholders, including salary, various fringe benefits, and transactions between the company and management; * The financial condition of the business, including financial statements audited by an independent certified public accountant; and * Our competitive position and material terms of contracts or lease agreements.
* It is imperative that we remain flexible enough to respond to changing developments, but also stick to our underlying position. Management not only needs to be involved but also must appear to be involved to the public. We may want to consider activating third-party support to help assist our cause, such as an independent accounting firm. * In addition, we need to centralize all communications. In any crisis, a communications point person should be appointed and a support team established. This way, all the communication from the company is consistent. We should also cooperate with the media. If we alienate the media, it would look bad on the company and possibly cost us millions. Keep the employees informed as well, ensuring that the organization’s business proceeds as normally as possible. * Finally, we should keep this crisis in perspective. Concentrate on communicating the steps that the organization will take to deal with this crisis. Admit blame if found guilty,...