Question: When the AcSB issues new standards, the implementation date is usually 12 months after the issue date, but early implementation is encouraged. In this case,

When the AcSB issues new standards, the implementation date is usually 12 months after the issue date, but early implementation is encouraged. In this case, Paula Prentice, controller, is discussing with her financial vice-president the need for early implementation of a standard that would result in a fairer presentation of the company’s financial condition and earnings. When the financial vice-president determines that early implementation of the standard will lower the reported net income for the year, he discourages Prentice from implementing the standard until it is required.

Instructions

Discuss the ethical issues of the financial VP’s request.
(CMA adapted)

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