Legality and Ethicality of Corporate Governance

Legality and Ethicality of Corporate Governance Frank Campbell, the director of unite 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 light up the gross revenue gross increase. By increasing the sales receipts 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 merchandise and reported the sales revenue to the financial reports. Assuming that this was okay, Campbell accept it be. It wasnt until the audit committee had seen the reports, the questions would arise. The internal auditors had learned that in that respect was pressure put on the accounting department by Campbell. The main concern of the auditors was the coverage of the two shipments valuing $150,000 (Mintz, 2011). Since there was not an expressed written agreement between United and the customers, the shipments should not have been direct. 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 reporting the revenue properly after sending out the shipments without violating the swindle tricks shipping point, the generall y accepted 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 apiece further. The criteria by which Sarbanes-Oxley would apply are the assessment of internal controls and criminal...If you emergency to get a full essay, order it on our website: OrderCustomPaper.com

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