Kevin Halen is the chief executive officer of Brenna Electronics. Halen is an expert engineer but a novice in accounting. Halen asks you, as an accounting student, to explain

(a) the bases for comparison in analyzing Brenna’s financial statements and

(b) the limitations, if any, in financial statement analysis.

Instructions Write a memo to Kevin Halen that explains the basis for comparison and the factors affecting quality of earnings.
ETHICS CASE