Ethics Service Revenue

Larry has been the chief financial officer (CFO) of Maxima Auto Service for the past 10 years. The company has reported profits each year it's been in business. However, this year has been a tough one. Increased competition and the rising costs of labor have reduced the company's profits. On December 30, Larry informs Robert, the company's president and Larry's closest friend for the past 10 years, that it looks like the company will report a net loss (total expenses will be greater than total revenues) of about $50,000 this year. The next day, December 31, while Larry is preparing the year-end reports, Robert stops by Larry's office to tell him that an additional $75,000 of revenues needs to be reported and that the company can now report a profit. When Larry asks about the source of the $75,000, Robert tells him, Earlier in the month some customers paid for auto services with cash, and with this cash I bought additional assets for the company. That's why the $75,000 never showed up in the bank statement. I just forgot to tell you about this earlier. When Larry asks for more specifics about these transactions, Robert mumbles, I can't recall where I placed the customer sales invoices or the purchase receipts for the assets, but don't worry; I know they're here. We've been friends for a lot of years and you can trust me. Now, let's hurry and finish those reports and I'll treat you to dinner tonight at the restaurant of your choice.

Required: Discuss the ethical dilemma Larry faces.

Ethics Case Instructions

1) Please read the ethics case that your group has been assigned very carefully.

2) Provide a detailed discussion of what your team would do in the scenario. a. Assign each group member a different topic to address within the overall discussion. b. There should not be any repetition of the same points across the different team members pages c. The paper should flow as one overall discussion even though there are different authors

3) Each person in the group must write at least one full page. For example, if there are four people in the group, your group should hand in a 4-page paper.

4) Each page should be double-spaced, using 12-point Times New Roman font, with 1-inch (normal) margins.

5) The written report should include a cover page with a title, the names of the team members, name and section of the class, the name of the professor, and due date.

6) If you cite any external sources, please include a references section at the end of the report or as footnotes.

*** I need another view point which is not from the CFO's standpoint aka Larry***