  Active Galactic Nuclei (AGN) show excess X-ray emission above 10 keV compared
with extrapolation of spectra from lower energies. Risaliti et al. have
recently attempted to model the hard X-ray excess in the type 1.8 AGN NGC 1365,
concluding that the hard excess most likely arises from Compton-scattered
reflection of X-rays from an inner accretion disk close to the black hole.
Their analysis disfavored a model in which the hard excess arises from a high
column density of circumnuclear gas partially covering a primary X-ray source,
despite such components being required in the NGC 1365 data below 10 keV. Using
a Monte Carlo radiative transfer approach, we demonstrate that this conclusion
is invalidated by (i) use of slab absorption models, which have unrealistic
transmission spectra for partial covering gas, (ii) neglect of the effect of
Compton scattering on transmitted spectra and (iii) inadequate modeling of the
spectrum of scattered X-rays. The scattered spectrum is geometry dependent and,
for high global covering factors, may dominate above 10 keV. We further show
that, in models of circumnuclear gas, the suppression of the observed hard
X-ray flux by reprocessing may be no larger than required by the `light
bending' model invoked for inner disk reflection, and the expected emission
line strengths lie within the observed range. We conclude that the
time-invariant `red wing' in AGN X-ray spectra is probably caused by continuum
transmitted through and scattered from circumnuclear gas, not by highly
redshifted line emission, and that measurement of black hole spin is not
possible.
