(Note: The situation is a little trickier when the auditor is the same for both companies, and for the time being only the auditor knows of the related company's woes; this exact situation is often given to final year accounting / auditing students as an example of an
irresolvable ethical
dilemma, since they can not allow the information to be either disclosed (to protect client confidentiality) or undisclosed (to protect investors).)