Strayer University Linbarger Company Ethics in Accounting Case Study Paper
Description
Having Trouble Meeting Your Deadline?
Get your assignment on Strayer University Linbarger Company Ethics in Accounting Case Study Paper completed on time. avoid delay and – ORDER NOW
Assignment: Ethics in Accounting
Effectivefinancial reporting depends on sound ethical behavior. Financialscandals in accounting and the businesses world have resulted inlegislation to ensure adequate disclosures and honesty and integrity infinancial reporting. A sound economy is contingent on truthful andreliable financial reporting.
Instructions:
- Read the following scenario.
- Answer the questions that follow. (1-2 paragraphs per question)
- Reference back to your text book for guidance on how to think through the scenario.
Scenario:
Imagine you are the assistant controller in charge of general ledger accounting at LinbargerCompany. Your company has a large loan from an insurance company. Theloan agreement requires that the company’s cash account balance bemaintained at $200,000 or more, as reported monthly. At June 30, thecash balance is $80,000. You give this update to Lisa Infante,the financial vice president. Lisa is nervous and instructs you to keepthe cash receipts book open for one additional day for purposes of theJune 30 report to the insurance company. Lisa says, “If we don’t getthat cash balance over $200,000, we’ll default on our loan agreement.They could close us down, put us all out of our jobs!” Lisa continues,“I talked to Oconto Distributors (one of Linbarger’slargest customers) this morning. They said they sent us a check for$150,000 yesterday. We should receive it tomorrow. If we include justthat one check in our cash balance, we’ll be in the clear. It’s in themail!”
Questions:
- What is the accounting problem that the Linbarger Company faces?
- What are the ethical considerations in this case? Provide rationale for why these are ethical considerations.
- What are the negative impacts that can happen if you do not follow Lisa Infante’s instructions to wait one more day to post the balance?
- Who will be negatively impacted if you do comply? Provide a rationale for why these individuals will be impacted.
- Whatis one alternative that you could pursue in this scenario? Support yourrecommendations with information you learned in this class.
