In addition to this Madoff not applying The Revenue Recognition Accounting principle to their financial statements. The Revenue Recognition principle is important because shareholders, creditors and outside investors is making more importantly, Its needed for the income statement. This financial statement gives an over view of all revenue and expenses showing the public their operating expenses and revenue totals. investors want to see how much profit a company is making and expenses. If income statement is accurate it will allow future investors, and shareholders, and creditors to make better decisions for as investing in Madoffs company. Arvedlund stated "Cohmad's most successful money-raisers were earning as $500,000 a month on referral
