ETH 376 Legality and Ethicality of Financial Reporting

SAMPLE

Excello Telecommunications has been a profitable company for several years, but for the first time they have encountered an increase in competition for its products by overseas manufactures. It seems that their earnings will not be met for the year ending 2010. Therefore, management is fretful how this will affect the company's future with investors (Legality and Ethicality of Financial Reporting Anti Essays, 2013). A large sale has been made right at the end of the year and this sale could make the company better or not. The problem is that the buyer cannot purchase the items until right after the end of the year which will not then be reported in this year's accounting period. The CFO is asking for ways to post this sale to this year's books to show a profit and draw the investors' attention. In this paper we will observe the probable solutions and explain their ethical downfalls as well as federal and state laws that apply to the case. (Legality and Ethicality of Financial Reporting Anti Essays,2013).

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Write a 1,200- to 1,500-word paper explaining the legal aspects, financial standards involved, and ethicality of the Excello Telecommunications case. Your paper should include the following:

Identify the legal issues involved-consider state and federal laws-and explain how they apply to the case.

Determine the criteria by which Sarbanes-Oxley would apply to this case.

Identify the specific financial reporting standards involved and explain how those standards were violated.

Evaluate the financial reporting activity in terms of the AICPA Code of Professional Conduct.

Determine the ethicality of the events within the case.

Select the best alternative offered by the team. Defend your decision in terms of its legality, ethicality, and alignment with accounting standards.