Problem:
(Knapp, W. 8e. PP. 193-195)
Question 1. Identify audit procedures that might have detected the improper accounting treatment applied by Dollar General to the transaction with IBM.
Question 2. Identify the accounting concepts or principles violated by Dollar General in this case. Defend each of your choices.
Question 3. Under what circumstances, if any, are "earnings management" techniques acceptable under GAAP? Under what circumstances, if any, are such techniques ethical? Explain.
Question 4. In addition to the parties identified in this case, what other parties bore some degree of responsibilities for the improper accounting applied to the Dollar General-IBM transaction? Explain.