Jane owns a furniture store with three locations. It is the end of the fiscal year and profits are not where they should be; in fact, it looks like there will be a loss.

Jane has some significant debt and, without a profit, it is likely the line of credit will not be renewed. You are the CPA and notice that some of the inventory counts look a bit funny; the stores could not possibly own that many couches! When you ask Jane about it, she smiles and says, "We have count sheets, which I have approved, so don't stress over it. Even if they are a bit high, the documentation is there so we are covered." How do you feel about this? What would you do in this situation?