1A. Why does FASB consider revenue recognition to be one of the most important areas on a financial statement? Identify and describe a past, public company's fraudulent reporting of revenues and determine the impact it had on society as a whole. Enron, one of the biggest fraudulent financial reporting companies of all time, more than doubled its reported sales between 1999 and 2000. Before it declared bankruptcy, Enron said it was on track to double it's revenue again in the following year. See the Enron the Incredible article in Forbes from 2002.

1B. Identify and discuss why there is a difference between financial reporting and tax reporting when accounting for income taxes.