In this discussion, you will employ lessons learned from past accounting scandals to situations accountants may face during their careers.
As a CPA, you are experiencing significant ethical and legal issues in your public company. You suspect that the CEO and CFO might be recognizing revenue before it has been earned. You also know that the preliminary sales estimates reflect a shortfall of approximately $5 million. Bonus money is predicated on reaching the quarterly target. You stand to miss a $25,000 bonus if the target revenue figure is not met. You are somewhat conflicted because you don't want to be a part of a fraud investigation, but you really could use the bonus money to pay for your son's college tuition and living expenses. Discuss your ethical and legal options. What steps would you take to resolve the current situation?