Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Section B Mariam CPA is the accountant of a public listed company. She just completed meeting with Salman, who is the Chief Financial Officer (CFO)

image text in transcribed
Section B Mariam CPA is the accountant of a public listed company. She just completed meeting with Salman, who is the Chief Financial Officer (CFO) of the company. Salman tried to convince Mariam to go along with proposal to combine the revenue expenditures (15 various revenue expenditures such as repair of motor vehicle, fuel expenditure etc.) related to vehicle maintenance into one amount (OMR 40,000). Mariam knows that OMR 40,000 is a material amount to earnings and rules in accounting require the expenses related to day to day operations for a specific period should be linked to revenue generated for the same period. Which will yield the most accurate income statement result. Therefore, Mariam asked time to think about this matter. However, at the end of the meeting Salman stated, Mariam, you can get back to me tomorrow on how you are going to work it out. But keep in mind that you should act upon the request of management. Therefore, I really want you to act in favour of my proposal to capitalize the revenue expenditure to boost the earnings and meet the earnings expectation of financial analyst. This statement shows that Maryam is under great deal of pressure to fulfill the requirement of Salman. Further Salman informed that adjustment on accounting entries will help to provide for a bonus to management including herself. Assume you are in Mariam's position Critically evaluate the given scenario and provide the possible course of action that should be taken to resolve the ethical dilemma. Note: your answer must include the key fundamental ethical principles for accountants that are more relevant for the given scenario threats to independent faced my Mariam ethical issue faced by Mariam in the given scenario the stakeholders who will affected due to the given practices and who are the people Mariam can get connected to resolve the ethical issue. the possible course of action that should be taken to resolve the ethical issue (Total 40 marks) (Maximum word count - 800 words)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Loose Leaf For Financial Accounting Fundamentals

Authors: John Wild, Ken Shaw, Barbara Chiappetta

6th Edition

1260151980, 978-1260151985

More Books

Students also viewed these Accounting questions