Option #1: Suspicious Activities

Read the following case study and respond according to the instructions below.

The Lauren Consulting Group is headquartered in the United States, with subsidiaries in the Czech Republic and the Cayman Islands. Proceeds from its Czech Republic subsidiary are sent directly into its U.S. bank accounts using electronic fund transfers. A&J, P.C. is the auditor of the U.S. company. The audit team for Lauren notes that transfers were made several times prior to the date that services had been rendered by the Czech Republic subsidiary. The funds in its U.S. headquarters are invested in commodity trades, and once completed, the proceeds from these trades are transferred to the Cayman Islands subsidiary. The U.S. company usually recognizes Deferred Trading Assets on its books related to the transfers, and these deferred assets are supported by contracts with its Cayman Islands subsidiary.

Charles Letcher has recently been put in charge of the Lauren audit, and he thinks these cash transfers are of a questionable legal nature. When he approached Martin Johnson, a senior partner at A&J, Martin told him that the auditors’ main concern is with the year-end figures, unless one of the financial transactions threatens the viability of the company. He closes his discussion with Charles by telling him to “forget about it.”

Write a 2- to 3-page paper in MS Word responding to the following questions/topics:

1. Describe the activities and what types of crimes Lauren may have committed.
2. Are the activities of Lauren Consulting so suspicious that they should be reported to authorities, and if so, which authorities?
3. Should Charles collect any additional information before making a final decision?

Cite at least three sources supporting your responses,APA format, include introduction and conclusion