Discussion: Unethical Financial Practices
Unfortunately, unethical—and sometimes illegal—financial practices are a common source of difficulty for many companies. You have undoubtedly heard one or more news stories in the past several years of companies who have found themselves under scrutiny due to questionable transactions. Some of these unethical practices include manipulating financial statements with schemes such as accelerating revenues, using off-balance sheet items to hide expenses or book phantom profits, delaying expenses, channel stuffing, earnings manipulation, and other arrangements. Companies need to be held responsible for these tactics, as an ethical workplace environment starts at the top. In this Discussion, you and your colleagues will explore the factors that contribute to unethical financial practices in an organization.
To prepare for this Discussion:
- Identify a company in the news that has been involved with an unethical practice related to financial reporting methods within the last 5 years.
- Review the Academic Writing Expectations for 2000/3000-Level Courses, provided in this week’s Learning Resources.
By Day 3
Post a 150- to 225-word (2- to 3-paragraph) explanation of unethical practices related to financial reporting methods for a selected business. In your explanation, do the following:
- Briefly describe the company you identified that was involved in an unethical practice related to financial reporting.
- Explain what the unethical practice related to financial reporting methods is.
- Explain how you think something like this can happen at a company. Specifically, what are the contributing factors for this instance, as well as in general?
- Describe what measures you would put in place to prevent situations like this from occurring in the future.
- To support your response, be sure to reference at least one properly cited scholarly source.