Legality and Ethicality of Corporate Governance

Legality and Ethicality of Corporate Governance Frank Campbell, the director of joined thermostatic Controls Southern Division, was dissatisfied with the way the division had non met the targeted budget for 2010. He had found a way to identify the sales gross increase. By increasing the sales tax income for his division, Campbell would be satisfied. Campbell had found a way to increase sales by sending out two shipments to customers. These shipments were non to be delivered until 2011. The customers had contract the dates they fateed their product. Instead of offering the customers a deal, Campbell displace the mathematical product and reported the sales gross to the financial reports. Assuming that this was okay, Campbell bear it be. It wasnt until the audit committee had seen the reports, the questions would arise. The internal auditors had learned that there was pressure put on the accounting department by Campbell. The main concern of the auditors was the covera ge of the two shipments valuing $150,000 (Mintz, 2011). Since there was non an expressed written agreement between United and the customers, the shipments should not have been send. Campbell had been reassured by Lorenzo, Executive VP of Sales & Marketing, that he seen nothing wrong with recording the revenues in 2010.

However, this was still a concern for the CPA, Tony Cupertino. The legality of the events was within the laws of federal, state, and local government. By insurance coverage the revenue properly after sending out the shipments without violating the course tricks shipping point, the generally acc epted accounting principles (GAAP) were not ! violated. The revenue recognition principle was not violated. Cupertino had debated on whether to take his findings to the CFO, Walter Hayward. Although the shipments were sent before they were scheduled to, Cupertino was uncertain whether to pursue the issue severally further. The criteria by which Sarbanes-Oxley would apply are the assessment of internal controls and criminal...If you ask to get a full essay, order it on our website: OrderCustomPaper.com

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