Suppose you are a recent accounting graduate and begin work for a well-known consulting firm, Shady Deals, Inc. As you are preparing the final journal entries and the financial statements for the year ended 12/31, you notice that the company is operating at a net loss of approximately $25,000 for the year. When you give the financial statements to your boss, the controller, he tells you to record some consulting revenue as of 12/31, since you knew you were going to perform these services for your customer in January. In addition, he tells you to wait to book certain expenses until January, when the bills are paid.

a. What are the ethical considerations with this situation?

b. If you were to follow your boss’s instructions, would you be violating the IMA’s Statement of Ethical Professional Practice? If so, which standards would you be violating?

c. What should you do in this situation?