The company that you work for is a subsidiary of a larger company. At the beginning of each year, the subsidiary prepares a budget for the year that includes a forecast of revenues for the coming year. The subsidiary sells a significant amount of inventory to the parent to be used in the manufacture of another product. The subsidiary's revenues for the current year are short of the budgeted amount. An error in the books has misclassified an intercompany sale as an ordinary sale. The manager of the subsidiary asks you not to fix the error until after the books are closed.
What is your responsibility? What action, if any, should you take? Why?

  • CreatedMarch 13, 2015
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