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Accountancy Ethics and Disciplinary Actions

   

Added on  2020-04-07

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Running head: ETHICS AND GOVERNANCEEthics and GovernanceStudent’s Name:University Name:Author Note
Accountancy Ethics and Disciplinary Actions_1

1ETHICS AND GOVERNANCETable of ContentsQuestion 1..................................................................................................................................2Answer to Part A....................................................................................................................2Answer to Part B....................................................................................................................2Answer to Part C....................................................................................................................3
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2ETHICS AND GOVERNANCEQuestion 1Answer to Part AAs per the question the stakeholders listed in the situation are Freda Chuse, themanager of Vroom Limited, Lucia, the accountant and all the present and active stakeholdersor shareholders of the company.Answer to Part BIn this question it has been asked that Freda had asked Lucia for finding solutions ofdeferring recognition of as much revenue as possible for the next financial year because thetotal earned revenue for the financial year ending on 30 June, 2016 being $3.5 million, Fredahad assumed or expected that this would definitely would hamper the normal proceedings ofbusiness. This is because Freda had logically concluded that if the company earned too muchrevenue then it would be a problem because this amount would definitely show in thefinancial statements, therefore the Government in charge of paying grant would refuse to doso. It is mentioned in the question that Vroom Ltd received grant from the government for theevent of training apprentice mechanics and on account of huge profit earned, the companywould surely lose the grant of $100000 tax-free cash inflow (Zadek, Evans and Pruzan 2013).The other reason for which Lucia had been asked to defer the revenues is that, as per the datain the question, the bonus received by Freda will be of maximum amount when the revenueearned by the company is $3 million. So when the total revenue earned by the company is$3.5 million, Freda would not be benefitted by any means. On the other hand Freda hadanalyzed that the revenue earned by the company for the next financial year would not be ofsuch higher prospective. Therefore deferring the revenue of $3.5 million to the next financialyear would be financially effective both for Freda and the company and would also help in
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