The income statement of Royal Bank of Singapore reported the following results of operations: Earnings before income

Question:

The income statement of Royal Bank of Singapore reported the following results of operations:

Earnings before income taxes and extraordinary gain ............... $187,046

Income tax expense ................................................................... 72,947

Earnings before extraordinary gain ........................................... 114,099

Extraordinary gain, net of income tax....................................... 419,557

Net earnings.............................................................................. $533,656

Suppose Royal Banks management, in violation of International Financial Reporting Standards (IFRS), had reported the company’s results of operations in this manner:

Earnings before income taxes ................ $847,111

Income tax expense ............................... 352,651

Net earnings.......................................... $494,460

Requirements

1. Identify the ethical issue in this situation.

2. Who are the stakeholders?

3. Evaluate the issue from the standpoint of

(a) Economic

(b) Legal or regulatory

Stakeholders
A person, group or organization that has interest or concern in an organization. Stakeholders can affect or be affected by the organization's actions, objectives and policies. Some examples of key stakeholders are creditors, directors, employees,...