AggiePride Nationwide, assistant chief accountant at Martin Company, is trying to prepare a trial balance so that the quarterly financial statements can be prepared and released to management and regulatory agencies. Agg-ie noticed that the total credits on the trial balance exceeded the debits by $1,000. She added the amount of the difference in the Equipment account, the largest account percentage-wise, in order to force the debits and credits to balance. She assumes that her actions of plugging in the difference into the account will not affect anyone’s decision.
a) The stakeholders in this situation are AggiePride Nationwide, Martin Company, management, and regulatory agencies.
b) The ethical issues that were involved in this case were:
i. …show more content…
Agg-ie decides to forcefully adjust the trial balance in order to meet the deadline. She realizes that the financial statements were already late, and now she is trying to meet the 4 p.m. deadline. ii. She plugs in $1,000 difference into the Equipment account. This is action can cause the financials to be thrown off because she assumed that the equipment account would not be misstated. This assumption is unethical because someone in management might have knowledge about accounting, and can possibly detect the error that she made in the trial balance just by observing the financial statements of the current year and prior years. iii. She assumed the difference won’t affect anyone’s decision; however, she doesn’t know if that is true. Management’s and the regulatory agencies’ decisions might be misconstrued due to her error, although they did not see her prepare the trial
a) The stakeholders in this situation are AggiePride Nationwide, Martin Company, management, and regulatory agencies.
b) The ethical issues that were involved in this case were:
i. …show more content…
Agg-ie decides to forcefully adjust the trial balance in order to meet the deadline. She realizes that the financial statements were already late, and now she is trying to meet the 4 p.m. deadline. ii. She plugs in $1,000 difference into the Equipment account. This is action can cause the financials to be thrown off because she assumed that the equipment account would not be misstated. This assumption is unethical because someone in management might have knowledge about accounting, and can possibly detect the error that she made in the trial balance just by observing the financial statements of the current year and prior years. iii. She assumed the difference won’t affect anyone’s decision; however, she doesn’t know if that is true. Management’s and the regulatory agencies’ decisions might be misconstrued due to her error, although they did not see her prepare the trial