Unformatted text preview: result of the error are retrospectively restated to reflect the correct inventory amount, cost of goods sold, net income, and retained earnings when those statements are reported again for the comparative purposes in the current year’s annual report” (Spiceland, Sepe, & Nelson, 2011). 3. Discuss the ethical dilemma John Howard faces. Regardless of what the negative impact would be on bonuses, John Howard’s responsibility is to report any errors immediately. After all, it is what is expected and it is John’s job as the controller to do what is right for the company, it is the right thing he should do. Also, he could be facing many consequences when the error has been found when he could have brought it to the company’s attention. As it is stated in our book, “Accounting errors must be corrected when they are discovered” (Spiceland, Sepe, & Nelson, 2011)....
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- Fall '10
- Generally Accepted Accounting Principles, John Howard, lower net income