Question
In doing cost analysis, you realize that there could be errors in the accounting records. For example, maintenance costs were recorded as zero in December.
In doing cost analysis, you realize that there could be errors in the accounting records. For example, maintenance costs were recorded as zero in December. However, you know that maintenance was performed in December. You find that maintenance costs were about double the normal monthly amount in the next month, January. You suspect that maintenance costs were not recorded in December, the last month of the year, so the departments costs would appear to be below budget. The apparent error could affect regression analysis because you are using both December and January in your analysis. Should you report your concerns about the way maintenance costs have been recorded? If so, to whom would you report your concerns?
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