The director of marketing for Truss Industries Inc., Ellen Knutson, had the following discussion with the company controller, Bud Wyckoff, on February $26$ of the current year:

Ellen: Bud, it looks like I$$m going to spend much less than indicated on my February budget.

Bud: I$$m glad to hear it$.$

Ellen: Well, I$$m not so sure it$$s good news. I$$m concerned that the president will see that I$$m under budget and reduce my budget in the future. The only reason that I look good is that we$$ve delayed an advertising campaign. Once the campaign hits in May, I$$m sure my actual expenditures will go up$.$ You see, we are also having our sales convention in May. Having the advertising campaign and the convention at the same time is going to kill my May numbers.

Bud: I don$$t think that$$s anything to worry about. We all expect some variation in actual spending month to month. What$$s really important is staying within the budgeted targets for the year. Does that look as if it$$s going to be a problem?

Ellen: I don$$t think so$,$ but just the same, I$$d like to be on the safe side.

Bud: What do you mean?

Ellen: Well, this is what I$$d like to do$.$ I want to pay the convention$-$related costs in advance this month. I$$ll pay the hotel for room and convention space and purchase the airline tickets in advance. In this way, I can charge all these expenditures to February$$s budget. This would cause my actual expenses to come close to budget for February. Moreover, when the big ad$-$ vertising campaign hits in May, I won$$t have to worry about expenditures for the convention on my May budget as well. The convention costs will already be paid. Thus, my May expenses should be pretty close to budget.

Bud: I can$$t tell you when to make your convention purchases, but I$$m not too sure that it should be expensed on February$$s budget.

Ellen: What$$s the problem? It looks like $$no harm, no foul$$ to me$.$ I can$$t see that there$$s anything wrong with this$$it$$s just smart management. State a definitive answer to the case question posed at the end of the narrative, "How should Bud Wyckoff respond to Ellen Knutson's request to expense the advance payments for convention$-$related costs against February's budget?"

Discuss in your answer the appropriateness of the Ellen $($Marketing Director$)$ prepaying the the convention$-$related expenses in February, when the convention will take place in May. Is this a good cautious move for the company and its cash flow? Is the Marketing Director's motivation for paying these expenses early done for the company's benefit or for her own self interest? Should this be viewed as a favorable move by the company's upper management?

In order to receive full credit for your answer, in instruction $1$ above, you must explain your reasoning. If you believe "Yes," that Ellen should be allowed to expense the advance payments in February, you must say why you think it is OK$.$ If If you believe $"$No$,"$ that Ellen should not be allowed to expense the advance payments in February, you must say why you think this is inappropriate.